Oil is consolidating after the rally seen last week. OPEC’s meeting brought a relative strong will of cutting production from the lobby, with a subsequent reaction to the price. Russia’s cut was particularly surprising, accounting for more than 130,000 b/d out of a total cut of 372,000 among the OPEC+ countries, while OPEC’s own cut is increasing from 1.2m to 1.7m b/d.
Investors have bet on the solidity of the agreement, the next few weeks will be crucial for understanding if this will be strictly adhered to by all members. At this stage, this reduction has outweighed any oversupply fears, with WTI trading just below $59.
