Saudi Oil Minister Khalid al-Falih indicated that Saudi Arabia was preparing to cut production below the key psychological level of 10.000 million barrels per day, helping to drive Brent and WTI futures to the highest points in over a year. Following the announcement that non-OPEC countries would join OPEC in reducing production by approximately 558,000 barrels per day starting in 2017, there are growing indications that prices may have finally found a floor. If the parties are able to stick to the agreement and not defect by producing more during a period of higher prices, the moves may lead to a significant rebalancing of the energy market. Countries that plan to partake in the newly announced deal include Russia, Mexico, Oman, Azerbaijan, and even Kazakhstan. In the meantime, WTI futures for January delivery have pushed above $54.00 per barrel.
Crude Rallies as Saudis Promise Deeper Cuts
Daily Analysis - 12/12/2016