When will the global oil market get in balance? It already has and according to the International Energy Agency, that process is accelerating. The global oil market has achieved so-called market balance but much work remains to reduce excess global oil supply.
Can OPEC find love and happiness and balance in a world full of shale? The OPEC report is out. OPEC is getting ready to double down on production cuts as they raise their forecast for U.S. shale oil output. This is unprecedented for the cartel to not only comply with cuts but maybe extend them as U.S. shale producers continue to increase oil output.
Market participants in crude oil are continuing to shrug off persistent jawboning from oil ministers of some OPEC countries, most notably Saudi Arabia, about extending the production cuts into the second half of 2017, and possibly the first quarter of 2018.
The Saudi Oil Minister said he will do whatever it takes. Crude oil prices have regained stability after the massive washout last week. The selling drove oil to the point where we were either going back into a recession or at the very least at a point where shale would be in big trouble.
The USD/CAD ended its bullish run abruptly on Friday as investors shrugged off employment reports from Canada (weak) and U.S. (strong) and instead focused on a sharp rebound in oil prices. However, there has been no real follow-through in the selling pressure at the start of this week.