Diesel consumers looking at the results of this past weekend’s failure by the OPEC+ group to come to an agreement might be confused by the reaction.

Historically, OPEC meetings that fail to reach agreement on production levels result in the price of oil falling, with traders anticipating that the lack of restraints will likely lead to a rise in production and an imbalance in supply and demand.

In a virtual meeting Monday, the OPEC+ group — which consists of OPEC and a group of exporters that are not part of OPEC led by Russia — failed to reach agreement on its next step. The result was different than other market moves following an OPEC meeting that fell short of its goal. Prices rose. 

The increase as of approximately 9 a.m. Eastern time Tuesday was less than the levels first recorded around the globe on Monday. At that hour, West Texas Intermediate crude, the U.S. benchmark, had risen 0.84% to $75.79 per barrel, down from the high of $76.98 recorded after trade began Sunday evening U.S. time. Brent crude, the international benchmark, actually was down 0.39% to $76.86; its high for the day had been $77.84/b.

Ultra low sulfur diesel was up 0.75% to $2.1954/gallon. Its high for the trading day was $2.2101/g.

The OPEC+ group had been adding crude to the market monthly between May and June. It needed a deal to add more crude in August, with virtually all analysts agreeing that more oil was needed to supply a market with rapidly increasing demand. For example, Platts Analytics, part of S&P Global Platts, estimates that global oil demand could rise by 8.8 million b/d between June and December.

The International Energy Agency estimates that the “call” for OPEC crude will be 27.6 million b/d in the third quarter and 29 million b/d in the fourth. The call is derived by taking estimated global oil demand, subtracting non-OPEC output, subtracting the OPEC production of NGLs like propane and butane, and what’s left is the call. 

But that call is nowhere near to being reached by current levels of OPEC output, which Platts estimated at 25.71 million b/d for May, the latest month for which figures are available, 

According to multiple reports out of the meeting, it was the United Arab Emirates that made it impossible for a new deal to be put into place. The UAE, according to reports, is not objecting to more oil being put on the market. Rather, according to Platts, the country’s baseline production is 3.168 million b/d, and the country believes that number is too low. 

The result was no agreement to increase output in August, which is why the usual bearish market reaction to an OPEC failure to agree on policy was instead replaced with an upward movement in price. 

A sampling of analysts published by Bloomberg shows no consensus on what happens next. For example, it quoted UBS analyst Giovanni Staunovo as believing that there won’t be more oil coming onto the market immediately in the wake of the failed talks, which would push Brent to $80/b or more. 

But ING analyst Warren Patterson, head of commodities strategy in Singapore, was quoted as saying more oil is likely to be pumped in the wake of the weekend’s failed talks, which could work to push prices down. 

One piece of good news for the trucking sector — particularly that portion that services the nation’s oil patch — came from the analysts at Citi. The Bloomberg summary said Citi believes higher prices are increasing the likelihood of more production coming out of the U.S. as it reacts to those higher levels. 

Trucks serving the oil patch already have seen significantly increased opportunities. The latest Baker Hughes North American rig count, released Friday, stood at 475. That’s the highest since April of last year and is up 231 from the low water mark of 244 recorded in August. 

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