{"id":35407,"date":"2018-06-23T10:56:03","date_gmt":"2018-06-23T15:56:03","guid":{"rendered":"http:\/\/olduvai.ca\/?p=35407"},"modified":"2018-06-23T10:56:59","modified_gmt":"2018-06-23T15:56:59","slug":"opec-deal-ends-with-output-confusion-sets-stage-for-deal-unraveling","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=35407","title":{"rendered":"OPEC “Deal” Ends With Output Confusion, Sets Stage For “Deal Unraveling”"},"content":{"rendered":"
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OPEC “Deal” Ends With Output Confusion, Sets Stage For “Deal Unraveling”<\/span><\/a><\/h3>\n<\/div>\n
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Just 24 hours after OPEC appeared on the edge of splintering<\/a>, Iran seemed to cave and in a deal that was described as a victory for everyone, OPEC member states and Russia provided a vague assurance they would boost output by striving to return to full compliance of the original production quotas as set in the 2016 Vienna production cut agreement.<\/p>\n

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As Goldman summarized in its post-mortem, “no further details were provided, including no country level allocation, no guidance for non-OPEC participants or timeline for the increase<\/strong>.” Furthermore, during the press conference following Friday’s deal, the one question which never got an explicit answer is how much output would be boosted by<\/strong>, with little clarity shed beyond \u201ctargeting full compliance at the group level\u201d.<\/p>\n

This suggests that there is room for countries with spare capacity to increase production above the individual quotas but also that such adjustments could not be resolved.<\/p><\/blockquote>\n

As a result, Goldman’s energy analyst Damien Courvalin said that he views today\u2019s agreement “as masking disagreements within the group and a potential start to the unraveling of the deal<\/strong>, with core-OPEC and Russia looking to increase production but Iran opposing such an increase.”<\/p>\n

Bloomberg’s Javier Blas confirmed as much<\/a>, noting that Friday\u2019s agreement was a “fudge in the time-honored tradition of OPEC, committing to boost output without saying which countries would increase or by how much” <\/strong>a fudge which gave every member – especially Iran which by endorsing a production boost would have been seen as effectively approving of Trump’s sanctions and allowing other states to take its market share – an “out” to save face, by sufficiently masking up the details so no explicit accusations of backtracking can be made.<\/p>\n

Importantly, “it gives Saudi Arabia the flexibility to respond to disruptions at a time when U.S. sanctions on Iran and Venezuela threaten to throw the oil market into turmoil.”<\/p>\n

\u2026click on the above link to read the rest of the article\u2026<\/p>\n<\/div>\n<\/div>\n<\/article>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

OPEC “Deal” Ends With Output Confusion, Sets Stage For “Deal Unraveling” Just 24 hours after OPEC appeared on the edge of splintering, Iran seemed to cave and in a deal that was described as a victory for everyone, OPEC member states and Russia provided a vague assurance they would boost output by striving to return […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2,3,5],"tags":[1997,376,441,595,600,20626,701,827,4318],"class_list":["post-35407","post","type-post","status-publish","format-standard","hentry","category-economics","category-energy-2","category-geopolitics","tag-economic-sanctions","tag-goldman-sachs","tag-iran","tag-oil-production","tag-opec","tag-opec-deal","tag-saudi-arabia","tag-united-states","tag-zerohedge"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/35407","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=35407"}],"version-history":[{"count":2,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/35407\/revisions"}],"predecessor-version":[{"id":35409,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/35407\/revisions\/35409"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=35407"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=35407"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=35407"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}