Brent and West Texas Intermediate declined for the first time in three days as investors weighed the odds of a production cut from OPEC this week.
Hedge funds have turned less bullish on oil in the absence of any clear signal from the Organization of Petroleum Exporting Countries that it will act to bolster prices. The 20 analysts surveyed last week by Bloomberg were divided, with half predicting a cut and the rest no action. Saudi Arabia’s Oil Minister Ali Al-Naimi said today it’s not the first time the oil market has been over-supplied.
“Whether they are going to cut is up in the air,” said Paul Crovo, a Philadelphia-based oil analyst at PNC Capital Advisors. “I won’t make big bets either way. There is a lot of expectation that OPEC does need to cut. That’s the perception, and it’s going to drive the market.”