The headlines have it wrong.By THOMAS H. KEE JR.OPEC is going to reach a deal to cap and cut production when it meets, and the deal is going to be significant enough to cause demand to exceed supply by 800,000 barrels per day on average in calendar year 2017. Where currently we have more supply than demand, in 2017 there is going to be more demand than supply for oil, and oil prices are going to go through the roof.
In addition, Saudi Arabia has a vested interest that extends beyond the health of their economy to see oil prices surge over the next year or so, so they will not stop supporting prices. Saudi Arabia is going to issue an IPO for its oil assets, and it wants to get the best price possible, and the only way to do that is to get oil prices higher before the IPO comes to market.