Is an oil rally reversal on the way?
OPEC cuts to supply are a big part of the reason why oil prices have been climbing over the last year (with Brent Crude notching a 52.57% gain), but if these countries choose to start boosting their output again, (partly to compensate for a lack of supply from Iran and Venezuela) the rally could come to an end. Commerzbank strategist Carsten Fritsch said: “This discussion about possible OPEC supply increases after the June meeting has put a brake on the oil price, so $80 is a big hurdle to overcome.”
Senate Democrats in the US are also urging President Trump to reign in OPEC due to pump prices being at a 3-year high, but unless he chooses to give Iran or Venezuela a pass on sanctions (unlikely), there’s not much he can do.
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