US Shale Producers Could Wreck OPEC Led Oil Price Stability

Big oil producing nations have nearly achieved their goal of draining a prolonged oil glut after taking some bitter medicine: cutting the crude production that funds their governments.

But with victory in sight, U.S. drillers are poised to spoil OPEC’s plans for the second time in three years.


West Texas Intermediate graph

On Tuesday, the International Energy Agency warned that surging U.S. production could delay OPEC’s bid to balance the long-oversupplied oil market. It’s another sign that the 14-member cartel will have to adjust to a market whose ups and downs are increasingly influenced by U.S. shale oil.

The IEA’s warning came in the latest monthly report from the Paris-based adviser to energy producers — the first it has issued since U.S. government data showed America’s oil output topped 10 million barrels a day in November, roughly matching the all-time record set in 1970.

via CNBC

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
Alfonso Esparza

Latest posts by Alfonso Esparza (see all)