Oil extends drop as OPEC+ struggles for consensus on output plan

Oil extends drop as OPEC+ struggles for consensus on output plan

Oil fell for a third day as OPEC+ sought more time to reach a deal on production policy after a meeting broke down without an agreement.

Futures were 0.7 per cent lower in New York.

Ministers will now meet on Thursday rather than Tuesday to allow more time to deliberate on whether to delay a planned increase in output from January. While some see the market as too fragile to absorb additional barrels, others are keen to pump more to take advantage of higher prices following Covid-19 vaccine breakthroughs.

Asia's recovery, meanwhile, gathered pace. Factory activity in some of the region's biggest export-led economies including South Korea and China surged in November. The rebound highlights the uneven global demand picture OPEC+ is facing, with Europe and the U.S. grappling with a resurgent outbreak.

Oil has just capped its biggest monthly increase since May on optimism energy demand will rebound as Covid-19 vaccines are rolled out in the coming weeks. OPEC+ talks have been complicated by the price gain and cracks have appeared in the alliance, with Saudi Arabia's Energy Minister Prince Abdulaziz bin Salman signaling his dissatisfaction with the situation on Monday by telling others he may resign as co-chair of a