The Market
Since December, oil prices have been ranging between $48 and $55 per barrel.
Prices and Inventories
Inventory levels remain elevated, reaching historic highs.
In the above charts, the one on the left shows the long-term inventory situation, while the chart on the right shows a 12-year history. Normal inventories would be below 400 mb, so stockpiles remain elevated.
The Market
Oil prices have broken above their $44 to $52 per barrel trading range in the wake of the recent OPEC output agreement.
OPEC
In a reversal of recent policy, Saudi Arabia spearheaded an agreement to cut oil production. OPEC has agreed to cut production by about 1.3 mbpd and select non-OPEC producers have chipped in additional reductions of 0.53 mbpd as well. The total OPEC output quota is 32.7 mbpd.
The table below shows the projected cuts relative to what OPEC said it was producing (the reference column) and what Bloomberg estimated for October’s actual production. We have calculated the differences relative to quota from the two production estimates. The areas in yellow represent nations that were not awarded a quota. Indonesia is no longer an oil exporter, while Nigeria and Libya were not given a quota due to persistent production interruptions.