{"id":17158,"date":"2016-12-12T06:49:34","date_gmt":"2016-12-12T06:49:34","guid":{"rendered":"http:\/\/www.biphoo.com\/bipnews\/?p=17158"},"modified":"2016-12-12T06:50:05","modified_gmt":"2016-12-12T06:50:05","slug":"goldman-says-non-opec-output-cut-deal-aimed-at-inventory-glut","status":"publish","type":"post","link":"https:\/\/www.biphoo.com\/bipnews\/business\/goldman-says-non-opec-output-cut-deal-aimed-at-inventory-glut.html","title":{"rendered":"Goldman says non-OPEC output cut deal aimed at inventory glut"},"content":{"rendered":"
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Goldman says non-OPEC output cut deal aimed at inventory glut<\/span><\/strong><\/span><\/h2>\n

Goldman says non-OPEC output cut deal aimed at inventory glut:-<\/strong> Goldman says non-OPEC output cut deal aimed at inventory glut:- Goldman Sachs said the formal agreement by non-OPEC oil producers this weekend in Vienna to help curb output was reached with a goal of “normalization” of inventories and not necessarily just at raising oil prices.<\/span><\/p>\n

The Organization of the Petroleum Exporting Countries (OPEC) had previously agreed to cut output by 1.2 million barrels per day (bpd), and on Saturday, 11 non-OPEC producers agreed to join the effort and reduce output by 558,000 bpd.<\/span><\/p>\n

The cut was short of an initial target of 600,000 bpd but still the first OPEC\/non-OPEC output deal since 2001 and the largest contribution by non-OPEC producers ever.<\/span><\/p>\n

“Despite the smaller-than-preannounced cut, the agreement is nonetheless noteworthy as it lifts the uncertainty on the potential participation of non-OPEC producers to the OPEC cut,” the bank said in a note on Sunday.<\/span><\/p>\n

The agreement was followed by comments from top exporter Saudi Arabia’s energy minister Khalid Al-Falih saying that the kingdom may be willing to cut output to below 10 million bpd.<\/span><\/p>\n

The world’s top oil exporter told OPEC it pumped a record 10.72 million bpd last month, an OPEC source said, up from 10.625 million bpd in October.<\/span><\/p>\n

Goldman said an announced production cut from Russia was likely to remain short of the 300,000 bpd promised, noting that Russia’s participation was important.<\/span><\/p>\n

Goldman said implementation of the co-ordinated OPEC and non-OPEC production cuts was required to sustainably support spot oil prices at its H1 2017 price forecast of $55\/bbl for West Texas Intermediate crude. [O\/R]<\/span><\/p>\n

A better-than-expected compliance would initially lead to higher prices, “with full compliance worth an additional $6\/bbl to our price forecast,” it said.<\/span><\/p>\n

The bank warned, however, that as WTI prices neared $55 a barrel, that producers, especially in the United States, might begin to raise their output.<\/span><\/p>\n

“Ultimately, this remains a short duration cut in our view, targeting excess inventories and not high oil prices,” Goldman said.<\/span><\/p>\n

Source:- http:\/\/www.reuters.com\/article\/us-research-crude-goldman-idUSKBN1410CY<\/span><\/div>\n

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