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Oil turns negative as OPEC lifts output ceiling

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Dec 4, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Mumbai) - Oil prices fell into losses at both the sides of the Atlantic after the OPEC members kept the production levels unchanged as expected.

    As of writing, the Brent Jan futures were down 64 cents or 1.45% at USD 43.23/barrel. WTI crude oil was down 82 cents or 2.17% at USD 40.23/barrel.

    The OPEC lifted their output ceiling 31.5 million barrels per day from the previous ceiling of 30 million barrels per day. It must be noted that Indonesia’s (new entry in the Cartel) supply is not included in the output ceiling.

    The quota hike may be viewed as a move to match actual production, which throughout the year was at least 1.5 million barrels higher than the previous quota of 30.0 million barrels. Hence, the underlying message that comes through is the cartel is in no mood to cut production and may overshoot the new limit as well.
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