Oil Freeze Talks Still Discussed Says Russian Energy Minister

Russian Energy Minister Alexander Novak has a contrarian message for those who question the wisdom of freezing global levels of oil output.

Despite the collapse of talks on restraining production among OPEC and non-OPEC members earlier this year, he thinks the discussions were a success that might soon be repeated.

“It (the build-up to the meeting) paved the way for a reversal of negative trends in the oil markets,” Novak told reporters last week after meeting OPEC member Venezuela’s oil minister Eulogio del Pino.

“We have seen a large amount of short positions being closed while long positions have been opened,” Novak said in reference to speculative bets – shorts – in the market that prices will fall, and the opposite – longs – that they will rise.

The statement is important as oil ministers often talk about oil supply, demand and balance but rarely touch on how market speculators – dominated by hedge funds – build their positions.

via Reuters

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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