OPEC Deal Boosts Prices After Saudis Abandon Market Share Battle

Saudi Arabia’s gamble has failed. That, rather than the spike in oil prices, is the real story to emerge from the agreement reached by Opec’s 12 members that they must agree to cut production.

Let’s be clear, a deal to actually restrict the flow of crude oil onto the global energy market has not yet been reached. Opec has said that something needs to be done, and has made a vague commitment to trim between 500,000 to 1m barrels a day from current output, but it has yet to flesh out the details.

As one analyst rightly noted, Opec seemed to have been taking lessons from EU summits. It has agreed that something needs to be done, but has put off until another day the rather more difficult task of getting its fractious membership to decide what that should be.

via gThe Guardia

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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