Will Capping Libyan And Nigerian Output Salvage The OPEC Deal?

11 Jul 2017   OPEC

Since they struck the production cut deal in late November, OPEC and the non-OPEC partners that are part of the agreement have seen U.S. shale ramping up crude production more than anyone has expected, undoing the cartel’s efforts to bolster oil prices. But over the past three months, OPEC has also seen its very own Libya and Nigeria—exempt from the output cuts on the grounds that militancy had crippled their production—boost their respective production to the point of further unnerving the oil market and complicating even more the cartel’s not-so-successful efforts to reduce global oversupply and prop up oil prices. Although Saudi Oil Minister Khalid al-Falih tried to (again) talk up prices and said in mid-June that the market was headed “in the right direction” and that Libya and Nigeria “shouldn’t be considered a threat to the initiative”, OPEC is thinking of putting a ceiling on the crude oil […]

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