OPEC has yet to agree on a long-term strategy as Saudi Arabia objects to a proposal from arch-rival Iran that the exporter group aim for tighter control of the oil market, sources said, pointing to deep divisions over the way forward.
European equity markets are expected to open slightly higher on Tuesday following mixed trade in Asia overnight, as Chinese manufacturing data disappointed but the RBA cut interest rates to record lows of 1.75%.
Crude oil prices rose on Tuesday, boosted by expectations that demand could grow quickly enough to match supply this year, although concern over a potential battle for market share between Saudi Arabia and Iran limited gains. Front-month Brent crude futures were up by 74 cents at $45.22 a barrel by 1340 GMT (8:40 a.m. ET). U.S. crude futures rose 76 cents to $43.40 a barrel.
President Obama is landing in Saudi Arabia to try to smooth over sour relations with America’s long-term ally, Saudi Arabia. While the crude oil market is selling off overnight on renewed concerns about China’s economy and the ending of the Kuwaiti oil strike, this meeting today may have more of a long term impact on the future of oil prices then some of these short term factors.