The oil price has failed to find a direction today after 2 straight days of solid gains on the back of a planned extension cut from Opec and non Opec members such as Russia
In order to keep the oil price above $50 speculation has that oil production cuts will be extended beyond march and its seems as if everybody is on board.
“High OPEC compliance” and “roaring oil demand growth combined over the last few months have accelerated the rebalancing of the oil market,” said Giovanni Staunovo, an analyst at UBS Group AG in Zurich.
“Reports that Saudi Arabia and Russia are mulling over the prospect of an extension” have “played a part in buoying market sentiment and recently lifting oil prices.”
Although producing cuts are expected to keep a floor under the price of oil, increased production in the US may eventually push the price down“
That's classic Oil Markets 101, said Michael Wittner, head of oil research at Societe Generale,
“Too much crude in the U.S. and too little crude elsewhere means that U.S. prices weaken relative to global prices, and exports increase to address the imbalance." He added
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