OPEC announced on December 5 that it would be keeping its current oil production quota unchanged in spite of high oil prices plaguing the markets. Indeed, West Texas Intermediate (WTI) futures approached US$100 per barrel last month, although prices did retreat shortly thereafter on the back of an unexpected rise in US crude inventories in mid-November and initial expectations that OPEC might actually flood the oil markets with supply. However, the oil cartel's decision to stay on hold indicates that many OPEC members are concerned about US$ weakness and oil demand in light of the extended US downturn. WTI has since moved below US$90 per barrel. However, with supply-and-demand fundamentals exerting conflicting pressure on prices, the market likely faces further volatility to come.
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