Opec+ to meet to consider oil output cuts; French economy shrinks – business live

In better news from France, inflation has fallen… and by more than expected.

Over the last year, the Consumer Price Index (CPI) is estimated to have risen by 3.4% in November 2023, down from 4.0% in October, French stats body INSEE says.

During November alone, prices are estimated to have dropped by 0.2%.

On an EU-harmonised basis, French annual inflation dropped to 3.8% this month, down from 4.5% in October.

Newsflash: The French economy shrank unexpectedly in the last quarter, as the eurozone economy teeters on the brink of recession.

Updated GDP data just released shows that France’s economy contracted by 0.1% in July-September.

That’s worse than the first estimate of 0.1% growth for Q3, and follows growth of 0.6% in Q2.

The new data shows that French investment and consumer spending were weaker than initially expected.

INSEE, the statistics body, says:

The purchasing power of households gross disposable income (GDI) per consumption unit fell slightly (-0.2%) after remaining stable in the previous quarter. The household saving rate fell this quarter to 17.4% of GDI, after 17.9% in the previous quarter.

Trade also pulled GDP down, with exports falling by 1% while imports were stable.

The wider eurozone economy also shrank by 0.1% in the last quarter, according to statistics body Eurostat.

Brent crude has hit a two-week high this morning, as traders brace for today’s Opec+ meeting.

Updated: It traded as high as $83.85 per barrel, +0.9%, the highest since 14 November, following yesterday’s report that Opec+ was considering cutting production by as much as 1 million barrels a day.

Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.

To cut or not to cut? That is the question facing Opec+ today as the oil cartel meets (virtually) to set production levels.

Opec and its allies are expected to try to agree to cut the amount of crude oil they pump, in another attempt to prop up prices as demand weakens.

But there’s an unusual lack of consensus within the group, so analysts aren’t sure what to expect today.

This afternoon’s meeting has been delayed from last Sunday, due to a disagreement over output quotas by the African oil-producing countries.

And yesterday, the Wall Street Journal reported that Opec and its Russia-led allies are considering new oil production cuts of as much as 1 million barrels a day. That would be around one percent of global demand.

But some members may not support a cut, as Stephen Innes, managing partner at SPI Asset Management, explains:

There is increasing speculation that deeper OPEC+ cuts may encounter strong resistance, particularly from the United Arab Emirates and African producers such as Angola and Nigeria.

These countries resist accepting lower production baselines, even under weaker market fundamentals. The dynamics within the OPEC+ alliance continue to play a crucial role in determining production policies and addressing global oil supply challenges.

Opec+ has already been cutting output over the last year, and has removed around 5 million barrels per day, despite pressure from the White House to pump more to bring down motor fuel prices.

And Deutsche Bank has pointed out that if Opec+ don’t cut output, then the global oil market would move into an oversupplied position in early 2024, given oil demand growth and rising non-OPEC production.

Also coming up today

We find out today if inflation in the eurozone kept falling this month. The CPI index is expected to drop to 2.7%, from 2.9% in October, closer to the European Central Bank’s target of 2%.

There’s also new eurozone jobs report, while Canada will become the last G7 country to report GDP figures for the third-quarter of 2023 today.

The agenda

• 8.55am GMT: German unemployment

• 10am GMT: Eurozone flash inflation report for November

• 10am GMT: Eurozone unemployment report for October

• 1.30pm GMT: US weekly jobless claims

• 1.30pm GMT: Canada’s Q3 GDP report to be released

• 3pm GMT: Opec virtual meeting expected to start