The Oil Price Dance

Am I the only one that seems a bit puzzled over oil prices? As the chances for an OPEC agreement on production oscillates between they will or they won’t, the oil price gyrates in step with sentiment on the outcome of the meeting. For everyone in the Commodities industries, higher prices wouldn’t hurt. However, I think the speculators have got it wrong. While all of the noise is about OPEC’s attempt to manipulate prices by limiting output (and people complain about market manipulation by speculators etc.!), I am also reading plenty of articles in which it appears as if the world is awash with crude oil and that US and non-OPEC production will actually continue to rise. So what is it I am missing? All I see is oversupply and more oversupply for some time to come. Today, I read a Reuters story in which the case was made that OPEC’s war on shale oil has backfired on them. In fact, is has simply made the industry more resilient and more capable. “In shale fields from Texas to North Dakota, production costs have roughly halved since 2014, when Saudi Arabia signaled an output free-for-all in an attempt to drive higher-cost
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The Oil Price Dance appeared first on CTRM Center.