Published on MarketWatch
In the absence of shale oil, Omar Al-Ubaydli, a program director at the Bahrain Center for Strategic, International and Energy Studies, said he believes oil producers would agree to extend the output cut deal. But if the extension is secured, U.S. shale-oil will continue to expand, he said. “I believe that [OPEC has] underestimated the positive reaction from shale oil, and that in light of this, I would say the likelihood of an extension is around 40%, heading downward,” said Al-Ubaydli Still, “in an attempt to maintain market confidence, rather than doing ‘no deal’, they may do a reworked deal to project unity,” he said. Continue
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Published in Investor's Business Daily
"Increased oil prices have encouraged more shale oil than expected, and so it is possible that this will motivate a reassessment of the prevailing strategy," Omar Al-Ubaydli, an affiliated senior research fellow at George Mason University, told IBD. Continue Published in Investor's Business Daily
"Russia produces less for technical reasons," said Omar Al-Ubaydli, an affiliated senior research fellow at George Mason University's Mercatus Center. "It's harder to extract oil in deep Siberian winter." Continue Published on MarketWatch
Omar Al-Ubaydli, a program director at the Bahrain Center for Strategic, International and Energy Studies, singled out two scenarios. “Either they agree on each country producing optimally from its own perspective, and they will present it as if it is a collective agreement…or they will try to agree on something substantive and fail,” he said. In both cases, he expects to see only a “negligible effect” on prices as “oil markets are getting a little wiser to OPEC’s ineffectiveness and window-dressing.” Still, Al-Ubaydli, does see a downside price risk. “Trump is likely to enact policies that decrease U.S. oil imports,” he said. And a rise in shale oil production means that “prices above $60 a barrel are unlikely.” That said, “Trump’s policies will have an effect once their precise details are confirmed,” said Al-Ubaydli. “Everyone is holding their breath.” Continue Published in the Financial Post
OPEC nonetheless maintains an ability to influence day-to-day movements in oil markets. Following the agreement in Algeria, which is essentially an agreement to talk about a future agreement, prices for crude benchmark West Texas Intermediate rose six per cent. Prices slumped again slightly in the following days. Continue |
Omar Al-Ubaydli
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