OPEC Could Expand Cut Agreement by 6 Months

OPEC could extend its oil output cuts to the end of 2017, provided other producers continue to play ball.
Less than two weeks into an agreement between OPEC and non-OPEC producers to cut output by 1.8 million barrels per day, Saudi Arabia and Kuwait say they are open to prolonging the six-month deal.

“If we continue to see the current level of prices and the commitment of the community, as well as non-OPEC at a satisfactory level, I think we could renew it for another six months,” Kuwait’s oil minister, Issam Almarzooq, told CNNMoney.

Saudi Arabia’s oil minister Khalid al-Falih said all parties have shown willingness to extend if necessary.
Last month, some countries outside OPEC — including Russia, Mexico and Kazakhstan — agreed to join OPEC members in their effort to restrain supply.

But skepticism remains. Since 1989, OPEC has hammered out numerous production cuts just like the one it negotiated last year. And in that period, OPEC producers have pumped more oil than their quotas in all but a handful of months.

via CNN

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza