Oil opened with a bullish gap at the beginning of this week and it remained slightly bullish for the next two days. But it has reversed back down now and the comments from Saudi Arabia and other OPEC members are not helping the matters either.

The Canadian Dollar is also under immense pressure. USD/CAD has gained nearly 300 pips from the bottom to the top so far this week and it continues to grind higher. UK [[Brent]] Crude Oil has fallen below the $60 level today, while US WTI Crude Oil is heading towards the $50 level.

The Oil Minister of Saudi Arabia was commenting a bit earlier today and his comments didn’t offer much to Oil buyers. Below are a few pointers from his comments.

• Feeling optimistic about an overall agreement
• He hopes to conclude something by the end of tomorrow
• The decline in Oil prices is not in the interest of OPEC members
• Important to have non-OPEC members on board
• The options are for cuts of 500k to 1.5 million bpd
• 1 million bpd cut by OPEC+ would be enough

The last two comments give it all away. OPEC members will meet today. If they agree on anything, they will have to take it to the Russians tomorrow. The risk is that they might not agree on a production cut, then there’s the risk that Russia might not accept the deal.

But, even if they do agree to reduce the output, the consensus is to cut production by 1 million barrels per day. That doesn’t satisfy the Oil market at all. Oil traders were expecting a bigger production cut from OPEC+ cartel, so this doesn’t offer them much to chew on.

We might see a spike higher when the news comes for the cut in production, but that would be a good opportunity to go short on Oil, so we will follow it closely in the next few hours.