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Goldman Sachs said that Opec’s agreement to slash oil output would "unleash a sharp production" response in the US and the rest of the world.
Goldman Sachs said that Opec’s agreement to slash oil output would "unleash a sharp production" response in the US and the rest of the world.
Opec agreed on Wednesday to reduce output by about 1.2 million bpd from January 2017. The deal also included the group's first coordinated action with non-Opec member Russia in 15 years.
"This is a short duration cut, targeting excess inventories and not high oil prices, which would instead unleash a sharp production response both in the US and in the rest of the world," the US investment bank said in a note.
"The catalysts for a further rally in prices will need to come from confirmation of participation by non-Opec producers, evidence of compliance by Opec producers and more clarity on what Iran has agreed to do given conflicting numbers in the official agreement," Goldman said.
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