REUTERS
Oil prices took a dive on Wednesday to excess supply and expectations that OPEC producers will not change their production quotas at a meeting on Friday, Reuters has reported.
On Wednesday morning Brent futures fell by $0.40, to $65.09 a barrel, while WTI futures were down by $0.44, to $60.82 a barrel.
As reported by a source in the OPEC, Gulf members of the Organization of the Petroleum Exporting Countries (OPEC), which controls over 40% of the world's crude production, are mostly in favor of maintaining the group's oil output, and will formally agree on this at the meeting this week.
“There is consensus among Gulf OPEC countries, and others, to keep the [production] ceiling unchanged," the source said.
"Nobody wants to rock the boat. The meeting is expected to be smooth sailing."
Some analysts say there is a chance that OPEC may even increase its production target from the current 30 million barrels per day.
"With the heightened geopolitical risks threatening oil supplies in the Middle East and North Africa, it is highly unlikely that OPEC will reduce the quota, but an increase is possible," Barclays said in a preview note of Friday's meeting.
Analysts from Citi said this week that given the fact that OPEC was not going to reduce its production, the global surplus would last well into 2016.