For much of the month, 14 members of the oil cartel OPEC and 10 non-OPEC producers have been basking in the satisfaction of ever strengthening crude prices, having collectively taken 1.8 million barrels per day (bpd) out of the global supply pool at least until 2018 if the current agreement holds. This week, the Brent front month futures contract - considered the world's proxy benchmark - touched a three-year high capping price levels not seen since November 2014. Reinforcement of the bullish sentiment came at the conclusion of the Joint Ministerial Monitoring Committee (JMMC) meeting on Friday (20 August) in Saudi Arabia, where OPEC and non-OPEC producers participating in the cuts led by Saudi Arabia and Russia reaffirmed their rigorous enforcement of the move. Based on the figures released, it seems the cuts are within touching distance of 2.7 million bpd, well above the pledged 1.8 million bpd, as Venezuela's production continues to tank, Angola struggles and Libya remains uncertain. All of it was primed to end on a note of 'crude' satisfaction, none more so for the hedge funds and money managers piling in to the oil market hoping to extend the recent geopolitical risk-driven gains further in the hope that the rally becomes a sustained one.

Source: Forbes April 20, 2018 18:55 UTC