Can OPEC Keep Its Nerve?

12 Jun 2017   OPEC

The recent OPEC agreement to extend production cuts for a further nine months has had a mixed response from industry commentators. For some, it’s an example of OPEC’s new steadfastness and unity of purpose, whereas for others it’s a deal likely to have little impact on bloated oil inventories and the current oil price. For such critics, other, more influential factors are in play undermining OPEC’s influence – American shale production, for example. Yet, like many things in life, it’s never as clear-cut. In this blog, I will look at the upside and downside risks of the new extension and whether it is likely to have the desired effect on both inventories and prices. What’s Working In OPEC’s Favor Firstly, there are a number of factors in OPEC’s favor – in particular the remarkable discipline of OPEC members over the last few months. While many OPEC deals in the […]

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