Don’t expect an oil freeze

Top oil producers are meeting to discuss freezing their output at current levels. Don’t hold your breath.

"'Freeze' is a word rarelyheard in balmy Doha," saysThe Wall Street Journal'sSpencer Jakab. But onSaturday 17 April, top oilproducers are meetingto discuss freezing theiroutput at current levels.Still, don't hold yourbreath. Saudi Arabia hasalready said that it willonly keep output stableif Iran does too, and thisis unlikely. Having beenfrozen out of the market foryears as a result of Westernsanctions, it is keen toregain market share.

A freeze would make scantdifference to the globaloversupply of two millionbarrels per day anyway.That is already being veryslowly worked off as UScrude inventories haveeased from their highestlevel since the 1930s andshale production fallsfollowing a slide in drillingactivity. US output hasfallen for ten of the past11 weeks, says America'sEnergy InformationAdministration.

Meanwhile, Iran's return tothe market has been slowerthan expected. It could takeuntil next year for Iranianexports to reach their fullpotential. So freeze or nofreeze, oil appears to havebottomed and looks set torise very slowly over thenext two years.

Recommended

The charts that matter: bond yields turn back up and a new bitcoin record
Global Economy

The charts that matter: bond yields turn back up and a new bitcoin record

Bitcoin hit a new all-time high, while government bond yields turned back up. Here’s how that has affected the charts that matter most to the global e…
23 Oct 2021
Coal makes a comeback
Coal

Coal makes a comeback

The environmental case against coal may be clear, but that hasn't stopped the price rising more than fourfold in the last year.
22 Oct 2021
The after effects of the gas-price shock
Economy

The after effects of the gas-price shock

In the wake of the recent spike in the natural gas price, we can expect slower growth, an industrial recession – and a newly assertive Russia, says Ma…
17 Oct 2021
The charts that matter: bond yields slip while bitcoin tops $60,000
Economy

The charts that matter: bond yields slip while bitcoin tops $60,000

Cryptocurrency bitcoin soared to over $60,000 this week, while government bond yields fell back. Here’s how that has affected the charts that matter m…
16 Oct 2021

Most Popular

Properties for sale for around £1m
Houses for sale

Properties for sale for around £1m

From a stone-built farmhouse in the Snowdonia National Park, to a Victorian terraced house close to London’s Regent’s Canal, eight of the best propert…
15 Oct 2021
How to invest as we move to a hydrogen economy
Energy

How to invest as we move to a hydrogen economy

The government has started to roll out its plans for switching us over from fossil fuels to hydrogen and renewable energy. Should investors buy in? St…
8 Oct 2021
How to invest in SMRs – the future of green energy
Energy

How to invest in SMRs – the future of green energy

The UK’s electricity supply needs to be more robust for days when the wind doesn’t blow. We need nuclear power, says Dominic Frisby. And the future of…
6 Oct 2021