Although there are still risks that lie ahead, the prevailing confidence that a deal to limit oil output will be reached has been enough to push Brent crude oil futures to the highest point since October 31st. Rumors that Iran and Russia are onboard with measures designed to reduce or limit production have been enough to spur a sustained rally in prices, with Brent rising approximately 12.50% off of last week’s lows. Nevertheless, despite the high level of optimism heading into the Vienna OPEC meeting, there are still several unknowns that could shift sentiment. The main roadblock to any deal remains an enforcement mechanism to verify quotas are not being exceeded. Without a way to resolve this critical issue, the rally higher in prices may quickly crash lower.
Quota Talks Send Oil Higher
Daily Analysis - 22/11/2016