Oil Prices Drop as OPEC Maintains Production Targets

As of 9:21 am EST, the price of crude had fallen by .60 percent to reach $73.28 a barrel and the price of heating oil had also declined by .60 percent.

HEAT USA Price Report

Today’s average retail heating oil price per gallon: Down $0.01
Morning projection (for Wednesday’s average price per gallon): Down $0.02

Oil prices fell after OPEC agreed to maintain its current production quotas. Though OPEC’s decision was expected, investors were concerned that several OPEC members were producing oil above their target levels, which adds to the global supply of oil and pressures oil prices to go down. With supply still far outpacing demand, even with colder weather in the US Northeast, and the dollar’s recent upswing, investors are concerned that oil prices could be trending downward. By maintaining the status quo, OPEC indicated it was comfortable with oil prices and oil supply, including its own members’ noncompliance with OPEC targets.

HEAT USA price experts report that OPEC’s decision, because it was expected, could have a brief impact on oil markets. This week’s cold weather will likely lead to a drop in inventories of distillates, which include heating oil and diesel, and that would support higher heating oil prices. However, a strong dollar could outweigh the effect of the weather and cause oil prices to fall.