• 4 minutes Oil Price Editorial: Beware Of Saudi Oil Tanker Sabotage Stories
  • 6 minutes UAE says four vessels subjected to 'sabotage' near Fujairah port
  • 13 minutes Mueller Report Brings Into Focus Obama's Attempted Coup Against Trump
  • 15 minutes Magic of Shale: EXPORTS!! Crude Exporters Navigate Gulf Coast Terminal Constraints
  • 11 hours Wonders of Shale- Gas,bringing investments and jobs to the US
  • 42 mins Trump bogged down in Mideast quagmire. US spent $Trillions, lost Thousands of lives, and lost goodwill. FOR WHAT? US interests ? WHAT INTEREST ? . . . . China greatest threat next 50 years.
  • 8 hours Why is Strait of Hormuz the World's Most Important Oil Artery
  • 10 hours IMO2020 To scrub or not to scrub
  • 7 hours California's Oil Industry Collapses Despite Shale Boom
  • 13 mins Global Warming Making The Rich Richer
  • 4 hours Rural and Conservative: Polish Towns Go 'LGBT free' Ahead Of Bitter European Election Campaign
  • 3 hours Misunderstanding between USA and Iran the cause of current stand off, I call BS
  • 5 hours North Dakota oil output totals 1.39 million b/d in March, up 4% on month: state
  • 11 hours Knock-Knock: Aircraft Carrier Seen As Barometer Of Tensions With Iran
  • 3 hours Compensation For A Trade War: Argentina’s Financial Crisis Creates An Opportunity For China
  • 16 hours China Downplays Chances For Trade Talks While U.S. Plays ‘Little Tricks’
  • 16 hours Devastating Sanctions: Iran and Venezuela hurting
Jim Hyerczyk

Jim Hyerczyk

Fundamental and technical analyst with 30 years experience.

More Info

Oil Rises On OPEC’s Production Decision

Refinery

U.S. West Texas Intermediate is trading higher on Friday after OPEC and other major oil producers agreed on oil production levels starting from July. The intraday spike to the upside actually changed the main trend to up on the daily chart.

According to reports, the allied partners will aim to increase production to about 1 million barrels per day (bpd). However, reports went on to say that this figure represents about two-thirds of Saudi Arabia’s initial request.

Traders are saying the cartel settled on the 1 million barrel figure because some OPEC members would be unable to sufficiently ramp up crude production. Therefore, the increase in output may actually turnout to be between 600,000 to 800,000 bpd.

The rally on Friday is being fueled by short-covering, position-squaring and some speculative buying because some traders had been pricing in a little more than a 1 million barrel increase. Furthermore, OPEC is not expected to actually release a hard target, but many traders expect the real figure to remain well-below the 1.8 million barrels already being removed from the market.

Another reason for the bullish response is that recent figures show that production has fallen recently by about 2.8 million bpd so even with a 1 million barrel increase, there is still going to be a shortfall in the market.

Additionally, Saudi Energy Minister Khalid al-Falih said Friday morning that no-one should expect to see an “immediate flood”…




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