Commodity Blog

Commodity news, technical and fundamental analysis, market data on precious metals, energies, industrial metals, and soft commodities


Crude Oil Surges After Production Cut Agreement

December 13, 2016 at 0:16 by Vladimir Vyun

Futures for crude oil surged more than 2% on Monday, reaching the highest level since mid-2015, following the weekend’s meeting between representatives from the Organization of Petroleum Exporting Countries and oil-producing countries not belonging to the organization. Several non-OPEC producers, including Russia and Mexico, agreed to join the production cut deal that the OPEC has announced on November 30. This was not unexpected, and the real surprise came from Saudi Arabia which said that it is going to reduce its output more than was agreed upon.

It is important to note that such major oil producers like the United States and Canada did not join the deal. Additionally, many analysts are skeptical about the participant’s commitment to the agreement and think that plenty of them are going to breach their pledge to reduce output. But for now, optimism prevails on the market, and that drove oil prices higher.

January futures for WTI crude oil settled 2.6% higher at $52.83 per barrel on Monday before trading at $52.60 as of 00:04 GMT on NYMEX today. Brent crude for delivery in February climbed 2.5% to $55.69 per barrel on ICE.

If you have any questions and comments on the commodities today, use the form below to reply.

Leave a Reply