We finally got a joint statement on Sunday afternoon.
OPEC+ is willing to cut the global oil production in amount of 9.7 million barrels per day.
That’s very much but it has to be more.
The investment bank Goldman Sachs just recently said that they believe a cut as high as 15 million barrels per day will be necessary to push the oil price higher again and away from it's lows.
For the moment it looks like the statement can stabilize price but I don’t think that this will be sustainable.
Bad market environment caused by the corona virus and not enough cutting further on could lead to a lower oil price again. I even think it’s possible that we will test the last lows of the market and go deeper.
What we can see at the moment are oil prices where it makes no sense for the manufacturers to produce it, cause the cost of it is higher than the price when they sell it. So very bad situation.
On the other side they have to sell it to generate an income stream.
I guess thats also the reason why so many countries struggle to cut production at the moment, its a classic dilemma.
OPEC+ is willing to cut the global oil production in amount of 9.7 million barrels per day.
That’s very much but it has to be more.
The investment bank Goldman Sachs just recently said that they believe a cut as high as 15 million barrels per day will be necessary to push the oil price higher again and away from it's lows.
For the moment it looks like the statement can stabilize price but I don’t think that this will be sustainable.
Bad market environment caused by the corona virus and not enough cutting further on could lead to a lower oil price again. I even think it’s possible that we will test the last lows of the market and go deeper.
What we can see at the moment are oil prices where it makes no sense for the manufacturers to produce it, cause the cost of it is higher than the price when they sell it. So very bad situation.
On the other side they have to sell it to generate an income stream.
I guess thats also the reason why so many countries struggle to cut production at the moment, its a classic dilemma.