OPEC Drama Keeps Oil Under Pressure

With Russia clarifying that it will not attend Wednesday’s meeting in Vienna, the optimism of an oil output cut deal being reached this week are looking increasingly distant.  Objections to the deal continue to emanate from both Iran and Iraq, each of which believes they should be exempted from any production cuts or freezes, putting the onus on Gulf nations to fill the gap with deeper output cuts.  The current structure of the agreement according to those close to the negotiation is for a 1.200 million barrel per day cut from production levels reported in October.  Hurting the likelihood of any pronounced gain in oil prices if a deal is reached is Russia’s abstention from attending talks, instead preferring to wait for the outcome of OPEC’s meeting before deciding on any production cap.  In the meantime, Brent is trading just shy of $48.00 per barrel.

The upcoming election season has brought the French economy back to the forefront of discussion as the Republican Party takes aim at current President Francois Hollande’s economic failures.  Unemployment remains high, still trending at 10.00% while growth is anemic relative to other Euro Area peers and the aggregate expansion.  Preliminary gross domestic product figures released earlier showed that the economy expanded by 0.20% during the third quarter, matching expectations and the prior reading.  The one silver lining was the consumer spending data which showed a marked uptick.  Data reported by INSEE showed that consumption climbed 0.90% during the month of October, beating expectations of 0.40% and the September reading of -0.40%.  After a tumultuous fall on Monday, the French CAC 40 is flat on the session as markets digest the latest economic figures.