Oil Sets Itself Up for Fall If OPEC Can’t Deliver Cuts Extension

Image Caption: Saudi Arabia and Russia are still debating what course to follow. 

 

Oil traders and analysts almost unanimously expect OPEC and Russia to prolong their production cuts next week. However, behind the scenes Saudi Arabia and Russia are still debating what course to follow. 

These high expectations, coupled with a recent surge in bullish bets on crude, amplify the risk to prices if the group can’t convince a hesitant Russia that it’s necessary to agree an extension right away. 

“Anything but an extension supported by Russia would have a significant impact on the price,” said Ole Hansen, head of commodity strategy at Saxo Bank A/S. “Not least due to the near record-long oil bet, which has left little room for error in terms of the communication from the OPEC ministers.” 

 

(Source: IndiaTimes.com)

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