After a brief relief, crude oil prices extend loses Friday. Brent keeps bleeding for an eights week in a row as demand-supply concerns still persist in the market ahead of the crucial OPEC+ meeting due next week. The prices failed to regain the $60 threshold and turned negative on the day, still threatening long-term lows below $58.
Over the weekend, the G20 Summit will take place in Argentina. Oil traders will focus on the widely expected dialog between the Russian and Saudi Arabia’s leaders in the context of potential production cuts. Should the presidents agree on the strategic issues, Brent will breathe a sigh of relief on rising chances for resuming quotas by the OPEC+ group. However, some other producers could be reluctant to limit output unless prices decline further dramatically.
This uncertainty will prevail in the markets in the days to come, which should cap the recovery potential. And the fact that buyers refrain from opening long positions, confirms the instability and discomfort in the oil market. Brent will likely finish this week on the defensive, with the downside risks are prevailing, while the bullish potential is very sluggish despite the oversold conditions. Once below $59, Brent could retest October 2017 lows.