• 3 minutes UAE says four vessels subjected to 'sabotage' near Fujairah port
  • 6 minutes Why is Strait of Hormuz the World's Most Important Oil Artery
  • 8 minutes OPEC is no longer an Apex Predator
  • 12 minutes Mueller Report Brings Into Focus Obama's Attempted Coup Against Trump
  • 4 hours Canada's Uncivil Oil War : 78% of Voters Cite *Energy* as the Top Issue
  • 36 mins Australia Election Summary: "This was the Climate Change Cult Election, and the Climate Change Cult Lost"
  • 1 hour Australian Voters Reject 'Climate Change' Politicians
  • 13 mins Shale to be profitable in 2019!!!
  • 9 hours California Threatens Ban on ICE Cars
  • 9 hours China Downplays Chances For Trade Talks While U.S. Plays ‘Little Tricks’
  • 9 hours IMO2020 To scrub or not to scrub
  • 7 days How can Trump 'own' a trade war?
  • 13 hours Global Warming Making The Rich Richer
  • 9 hours Did Saudi Arabia pull a "Jussie Smollett" and fake an attack on themselves to justify indiscriminate bombing on Yemen city population ?
  • 40 mins Misunderstanding between USA and Iran the cause of current stand off, I call BS
  • 44 mins DUG Rockies: Plenty Of Promise, Despite The Politics
  • 9 hours "We cannot be relying on fossil fuels to burn as an energy source at all in our country" - Canadian NDP Political Leader
  • 5 hours Some Good News on Climate Change Maybe

A Hot, If Not Very Sexy, Take On The OPEC News

Refinery

As I write this piece, we are still awaiting the official announcement of the outcome of the OPEC+ meeting in Vienna, but given the organization’s penchant for controlled leaks, and given that every major news organization is reporting a million barrel a day increase in output it is fair to assume those reports are accurate. So, as always, the question is what this means for traders and investors, and how can they profit from it?

(Click to enlarge)

Any analysis of the potential impact must start with what didn’t happen. Contrary to what was said by some going into this meeting, the different objectives and needs of OPEC’s various members did not result in the breakup of the cartel. For future reference, nor is it likely to any time soon. OPEC is, despite being inherently as anti-free-market as you can get, a great example of why capitalism works. When nations as diverse and divided as Saudi Arabia, Iraq, Iran and Venezuela can come together to maximize profit it is an indication of the power of the greed that moves markets, and that power should never be underestimated.

Secondly, as this Wall Street Journal article accurately states, while the crude oil output limits have been technically raised by a million barrels a day, the reality will fall well short of that number. The main proponents of an increase, Russia and Saudi Arabia, both have the existing capacity to increase immediately, but that is not true everywhere. By dividing…




Oilprice - The No. 1 Source for Oil & Energy News