Own goals

摘要

Opec has so far stuck fairly closely to the plan. The organisation, and allied non-Opec producers, have cut nearly 1.6mn b/d of supply this year to accelerate the rebalancing of the market, a compliance rate of over 90pc with the cuts agreed late last year (see graph). Stocks are unquestionably falling, even at a time when they normally rise. But progress towards the goal of returning oil inventories to previous seasonal norms is slow. Opec is developing a credibility issue. It has not convinced the market that the cuts will work, leaving oil prices mired at around $45/bl. There is little sign of it bridging this gap in the near term.