Thursday, May 25, 2017 6:28 AM EDT
OPEC members are convening in Vienna to discuss an extension to the deal that saw a cut in production. They seem to be converging about extending the cuts by 9 months, as reports had already suggested earlier. The cuts will probably at the same scale of the previous agreement.
Prices have gone up ahead of the deal, peaking just under $52 as ministers were arriving at the summit. The reach to the upside may have triggered a selloff. Is it a “buy the rumor, sell the fact” event?
USD/CAD is trading at 1.3433, up from lower levels. The Canadian dollar is sliding alongside the price of the black gold. Yesterday’s BOC decision was relatively optimistic, setting the pair at a lower level.
OPEC Background
The original agreement was made in November and was set to run between January and June. Since then, prices have stabilized but haven’t gone up. They were around $50 per barrel on the WTI Crude Oil.
Since then, oil production in the US picked up, reaching around 0.3 million barrels per day. This kept prices from going too high.
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