Why OPEC deal may not increase oil prices (USA)
17. 2. 2016
- Země: US - Spojené státy americké
- Datum zveřejnění: 17.02.2016
Gleaning insight into the direction of the Organization of the Petroleum Exporting Countries is a favored parlor game of the oil markets, as evidenced by three separate incidents recently in which oil prices spiked on hopes of a production cut.
But faith in OPEC’s ability to prop up oil prices may prove fleeting, as the global energy markets weigh the possibility of an OPEC production deal against the onset of new output by Iran and cash-poor U.S. producers that can’t afford to stop pumping.
After reports surfaced Tuesday that Russia, Saudi Arabia, Qatar and Venezuela are poised to freeze oil output at January levels, oil briefly surged before settling down and even dipping into negative territory as reality set in. Stocks also got a lift from the reports with the Dow Jones Industrial rising more than 200 points.
The prospect of a freeze didn't light a fuse under the market for crude. Prices are low for a reason: the worldwide surplus of production, a tepid global economy and the inability or unwillingness of producers to agree to cuts.
With Iran planning to return oil production to pre-sanctions levels and Saudi Arabia refusing to cut production, crude oil is unlikely to move higher than the $40 to $50 range in 2016, analysts say.
The U.S. benchmark crude, West Texas Intermediate, fell 1.4% to $29.04, while Brent crude, the international standard, slipped 3.6% to $32.18.