Can OPEC Halt An Oil Market Meltdown?

[Dan Warnick + 6,100]

Nick Cunningham always has a few nuggets in his articles:

Can OPEC Halt An Oil Market Meltdown?

excerpt

Because non-OPEC production (i.e. U.S. shale, Canada, and Brazil) will grow rapidly over the next few months, the IEA says that inventories could build at a rate of 2 mb/d in the first half of 2019. That goes a long way to explaining the recent meltdown in oil prices.

But that also is a baseline assumption that does not take into account any production cuts from OPEC+, which at this point, is almost certainly in the offing. The only question is by how much the group will be reducing. Saudi Arabia said that it alone would slash 500,000 bpd in December. Russia was a bit more non-committal in recent days, but the utter meltdown in prices on Tuesday – down 7 percent – could spur a more concerted effort.