• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 37 mins GREEN NEW DEAL = BLIZZARD OF LIES
  • 1 day Does Toyota Know Something That We Don’t?
  • 4 days OPINION: Putin’s Genocidal Myth A scholarly treatise on the thousands of years of Ukrainian history. RCW
  • 1 day World could get rid of Putin and Russia but nobody is bold enough
  • 8 hours America should go after China but it should be done in a wise way.
  • 4 days CHINA Economy IMPLODING - Fastest Price Fall in 14 Years & Stock Market Crashes to 5 Year Low
  • 3 days China is using Chinese Names of Cities on their Border with Russia.
  • 4 days Russian Officials Voice Concerns About Chinese-Funded Rail Line
  • 3 days CHINA Economy Disaster - Employee Shortages, Retirement Age, Birth Rate & Ageing Population
  • 4 days Putin and Xi Bet on the Global South
  • 4 days "(Another) Putin Critic 'Falls' Out Of Window, Dies"
  • 5 days United States LNG Exports Reach Third Place
  • 5 days Biden's $2 trillion Plan for Insfrastructure and Jobs
  • 9 days huge-deposit-of-natural-hydrogen-gas-detected-deep-in-albanian-mine

Breaking News:

Chicago Files Suit Against Big Oil

Editorial Dept

Editorial Dept

More Info

What’s Behind The New OPEC Skepticism?

OPEC+ took action to cut supplies from the market last week and threw themselves and U.S. frackers a substantial short-term lifeline. In terms of price action, the 1.2m bpd cut (to begin in January) seems to be mostly in line with what the market expected as Brent crude has flattened out near $60/bbl.

The tepid price movement following the announcement of the deal highlights both the bloated status of physical balances as well as the market’s expectation that U.S. producers will comfortably be able to keep a lid on prices in the near term. Traders are highly reluctant to resume the bullish enthusiasm they felt in early 2018 and have kept time spreads securely in contango. Analysts seem to feel similarly with the EIA reducing their 2019 Brent forecast to $61/bbl while Citi sees Brent trading in a $55-$65 range next year.

Market skepticism related to OPEC and OPEC+ production cuts isn’t new. Decisions made by the group to balance oil supplies with demand have always been met suspiciously as traders have questioned whether the group would actually self-impose the cuts they agreed to. This was certainly true the last time cuts were made in 2016 and prices slowly adjusted higher as data revealed that the group was highly disciplined in hitting quotas. What seems strikingly different this time around, however, is that the skepticism related to OPEC+ cuts seems to be that they lack the efficacy to shock the market higher because so many of the cut barrels…




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News