With just a day to go to the much anticipated OPEC meeting, the oil market is quite upbeat. WTI is currently trading at $51.6 per barrels and Brent at $2.8 per barrel premium. Tomorrow OPEC ministers are set to meet at their Vienna headquarter in order to decide the fate of the current OPEC deal that is aimed at removing as much as 1.76 million barrels of crude oil from the market. Here, we are going to discuss possible upside scenarios and the financial market’s working assumption.

• As of now, a nine-month extension of the deal till March 2018, is the working assumption of the market based on comments from Saudi Arabian and Russian oil minister who along with their Iraqi counterpart has agreed to the timeline. This assumption has the highest probability and does not see a change in any other components such as additional cuts.

• An upside scenario will be where the OPEC members agreed to extend the current deal for nine months and more countries join the initiative leading to bigger cuts in total. This is a real possibility and will be more bullish for the oil market than the working assumption. Saudi Arabia’s oil minister has hinted at this possibility.

• The best case would be where OPEC members agree not only to an extension of the current deal for nine months but agree to deliver much deeper cuts. This is an unlikely scenario but would be most bullish if happens, though it would depend on how deep the cuts are. Given the skepticism and economic troubles at some of the countries, this case would be a difficult one to achieve.