Oil Looking to OPECPosted 12/06/2019 8:58AM CT |
Oil prices have been pairing between gains and losses as the trade awaits the OPEC decision involving production. This comes amidst a larger than expected decline in EIA crude stocks as well as unabiding optimism on trade. OPEC in principle, as of this writing, have agreed to cut production by an additional 500,000 barrels per day through the end of March 2020, bringing the total to 1.7 million barrels per day or 1.7% of global output. This replaces the previous production cuts that had been initiated in January 2017 and comes as Saudi Arabia pushes for higher oil prices amid the initial public offering of state owned Aramco, which was just priced at a value of 1.7 trillion. With Saudi Arabia already producing less than their quota, the de facto leader has been adamant that if non-compliance by countries such as Iraq and Nigeria persist, they will boost production effectively assuring that overall output will continue for the three months. Oil is signaling immediate term overbought within its bullish trend with today’s range seen between 54.97 – 59.87.