[ad_1]
Analysts said that even if some form of an output restriction is announced after producers meet in Vienna on Wednesday, the details matter greatly.
«Do not take an announcement of a headline cut of 1 million barrels per day (bpd) at face value. It could still imply an OPEC production level considerably in excess of 33 million bpd, depending on developments in Libya and Nigeria and the speed and rigour of compliance,» David Hufton, managing director of brokerage PVM Oil Associates Ltd. said in a note.
He added that the stakes of failure are high for producer nations dependent on oil export revenue.
«But one thing few, if any, analysts will disagree with is that if OPEC do not come up with a credible agreement to cut production on Wednesday oil prices will end the year below $40 bbl and be chasing down $30 bbl early next year,» Hufton said.
Even if a cut is agreed, oversupply may not end soon.
The U.S. oil rig count rose by three last week, and Goldman Sachs said that «since its trough on May 27, 2016, producers have added 158 oil rigs (+50 percent) in the U.S.».
[ad_2]
fuente