U.S. oil producers appear to have lost their battle with OPEC (Organization of the Petroleum Exporting Countries) over market share, but the war is only just beginning, the International Energy Agency (IEA) warned Wednesday.
“In the supposed standoff between OPEC and U.S. light tight oil (LTO), LTO appears to have blinked,” the Paris-based energy think tank said in its new monthly report.
“Following months of cost cutting and a 60 percent plunge in the U.S. rig count, the relentless rise in U.S. supply seems to be finally abating.”
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The price of oil has collapsed from near $120 a barrel in June last year to lows of around $45 a barrel in January, although it has since bounced back to around the $60-a-barrel level.