Here’s the full agenda of the Opec meeting (timings are in CEST, so knock off an hour for BST).
Some background. Last November, Opec and non-Opec members agreed to cut their combined output by around 1.8 million barrels per day through the first six months of this year.
That deal did drive the oil price over $50 per barrel, but any hopes (or fears) that prices would push higher have been dashed (or allayed).
As this chart shows, the oil price actually dipped back in recent weeks, before rallying on hopes that the deal will be extended today.
Forward Guidance
(@ecoeurope)OPEC set to prolong cuts to help clear glut https://t.co/StVoACYbdo @JavierBlas2 #oil #OPEC pic.twitter.com/u2UrTxozoz
Queues are forming outside Opec’s headquarters in the Austrian capital, ahead of today’s meeting:
Ernest Scheyder
(@ErnestScheyder)Good morning from the OPEC Secretariat, where the fun is about to begin #opec #oott #oil #saudi #iran #iraq #venezuela #russia #nigeria #uae pic.twitter.com/dMOhGXLQsE
(@Amena__Bakr)Outside #OPEC HQ #OOTT pic.twitter.com/SPH6YYuDfE
Oil price rallies as Opec meeting begins
The agenda: Opec meeting and UK GDP report
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
All eyes are on Vienna this morning as energy ministers from the Opec oil cartel meet in Vienna.
On the agenda: whether or not to extend the oil production cuts deal which was agreed six months ago.
Oil analysts broadly expect an extension to be hammered out – as the alternative would spook the markets and send prices spiralling down. But the big issue is how long for.
Saudi Arabia (Opec’s biggest member) is pushing for a nine-month extension, and Iraq backed this plan earlier this week.
But there have been whispers that Opec might only extend oil output cuts by a mere six months, or could go the whole hog with a 12 month deal. So there’s all to play for in Vienna today.
Kathleen Brooks of City Index predicts that the Saudi’s will get their way:
The oil cartel meets today, and the market is expecting it to extend the period of production cuts by an extra nine months, through to March 2018. This has been widely signalled after Russia (a non-Opec member) and Saudi Arabia said that they would support an extension of the cuts last week.
There is a very small chance that some of the smaller, struggling members of Opec, including Venezuela and Nigeria, may resist the prospect of further cuts, overall we think that Saudi Arabia will ultimately get what it wants from this meeting.
Mike van Dulken of Accendo Markets says Opec should be wary of disappointing the markets:
Mike van Dulken
(@Accendo_Mike)OPEC talked up 9m cuts so much, anything less = disappointment. I hope they’ve been watching earnings season. Underpromise, overdeliver
Also coming up today:
We’re about to get fresh information on how the British economy performed in the first three months of this year.
The second estimate of UK GDP will reveal how business investment, net trade, personal spending and government spending changed over the quarter.
The City predict that consumer spending took a dive, as rising inflation hits shoppers.
Royal Bank of Canada say:
It is expected that a much more modest contribution from the consumer will be behind the lower growth figure, as real household disposable incomes have been hit by rising prices.
The Office for National Statistics is also expected to confirm that GDP only rose by a modest 0.3% in January-to-March, down from 0.7% in October-December.
- 9am BST: Opec opening session begins in Vienna
- 9.30am BST: Second estimate of UK GDP released
- 1.30pm BST: US trade balance for April
- 1.30pm BST: US weekly jobless figures
- 4pm BST: Opec press conference
We’ll be tracking all the main events through the day…
Updated