RE:RE:RE:RE:Re:dealbago wrote: Hey I agree but nobody knows if there is going to be a deal but the Russians have said all along no cuts but they may freeze. I think when push comes to shove they will come up with something but unless it's 1 million + we will still be rangebound as we may get a small temporary uptick. I am guessing we have a 60%-70% chance we get some kind of deal but only 50/50 if it will actually make a difference. Now if a deal doesn't happen we probably lose 10-15% off the oil price...mgba
Looks like this issue is complex. Reuters article says Russians have claimed the 880k cut is false and it's close to 500k. Russians are also arguing that by freezing, they will effectively be cutting 200-300k of production in projects in the pipeline that would have come online in 2017. If OPEC actually considers that a "non-OPEC cut", there is a little left for others participating to contribute. Guess we'll see how this all plays out.
As for the price result of a deal, seeing lots of bears trying to put the idea that a cut makes no difference for the price now. Pretty entertaining really. Impossible to predict, obviously many remaining shorts will bail. Many producers may hold off replacing their hedges that they cover for their Jan production expecting better prices, so that will be a tailwind. Long hedges may try to buy up oil worrying that prices will go up soon which helps prices as well. Never know how all the thousands of people dabbling in the futures market will react. Just like the Iran sanctions being lifted, people thought that was priced in, and when the day actually came, total panic.