Looks like the sleepover in Vienna went well. Nobody hogged the Xbox, the hot chocolate was flowing, and an agreement was struck between OPEC and non-OPEC members to cut production – you know, to avoid suicide. Looks like they’re also doing a little PR for the Saudis, perhaps to make everyone forget how they gave Hillary a bunch of money for that pipeline.
The Wall St. Journal reports:
VIENNA—Oil-producing nations struck a deal Saturday to cut output along with the Organization of the Petroleum Exporting Countries, a pact designed to reduce a global oversupply of crude, lift prices and lend support to economies hurt by a two-year market slump.
The agreement would remove 558,000 barrels a day of crude oil from the market. That would come on top of 1.2 million barrels a day in cuts already agreed to by OPEC, amounting to a total of almost 2% of global oil supply.
The non-OPEC cuts, if carried out as described over the first half of 2017, would represent an unprecedented level of cooperation among oil-producing countries that have been groping for ways to lift oil prices out of a two-year funk. –WSJ
Regardless of this arrangement’s actual impact on the glut of oil sloshing around, the message is clear that oil producing nations – OPEC and non-OPEC, are committed to putting a confidence-inspiring floor underneath the price of crude. Oil is currently up over 5%, and futures are ripping. Assuming nobody fucks up and these cuts are adhered to, and nothing else sabotages greatness, enjoy the continuation of this Trump rally until further notice, and witness the reflation of those sagging oil & gas stocks you’ve been holding onto for all this time.
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