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OPEC's Mountain to Climb

Wall Street Journal Original article ›

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Opec cuts by 2.2 million barrels a day on December 17, 2008, and forward curve for Nymex crude oil prices which goes up $10 to $50.64 for the May 2009 contract and $70 from late 2012, offers liitle support in terms of higher oil prices. Some of it is explained by costs of storing oil on tankers and some of it by higher credit costs, and prices beyond 6 months do not have as much significance as the situation is uncertain. With Russia needing oil revenues and Iran and Venezuela also in the same situation, it looks increasingly unlikely that the strict reduction in production will hold. And things like higher inventories with a steeper downturn in 2009, can keep prices down for a long time.

Global oil prices after the OPEC production cuts in December 2009.

02/04/2006

The future for global oil prices is for them to remain at these lower levels at about $40 a barrel according to experts.

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OPEC’s Oil Output Strategy Seen Potentially Backfiring

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OPEC's Mountain to Climb

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