In OPEC's ShoesHaving endured all this pain in terms fo their domestic deficits for so long OPEC finally have the higher cost producers on the rack. OPEC need the price to go up not through a deal with Russia but due to the damage that low oil prices have inflicted upon the higher cost producers.
OPEC need this to be messy, simpling roughing up the high cost producers is no good for OPEC they need blood on the floor, enough blood so that the high cost producers and in particular their creditors will be hesitant before making significant further investment for some time.
OPEC are hurting for sure, but why would they give up now, they are nearly there.
This of course is the longer route to oil price recovery, likely to be a very gradual stuttering price recovery of no great extent until the second half. The risk of a severe price spike from the second half onwards would then be very high. Low oil prices finally crushing the operational solvency of a small but significant proprtion of higher cost oil production is not a very controlled way to finally cut oil supply. A sharp global recession would then become likely.
Doug