Oil price: OPEC Agreement+ achieved, though with great difficulty

  • And
  • +A

The OPEC deal+ reached, though with great difficulty by market participants in Vienna, is the most discussed event of the past days. The parties signed the agreement to reduce the level of oil production by 1.2 million b/c as of January 2019 (in comparison with the production levels of Oct 2018). The agreement may be revised in April next year.
After this news, Brent Crude Oil increased by 9%, returning a little above $ 62 per barrel. Support was also expressed for the canadian dollar, which rose by 1.08% against the dollar, and of course the Russian ruble, which gained +of 1.43% against the U.S. currency.
Although the price of oil and the ruble reacted to the OPEC deal+ instant growth, however, there is a risk that this step will not be sufficient for long-term support for the oil market. This is indicated, for example, earlier reports from Saudi Arabia to overproduction of oil in the daily volume of about 10 million barrels, which is significantly higher than the level of production in the framework of the agreement.
After reaching a deal OPEC+ market attention shifted to the other outstanding issue, namely annoying all Brexit. Annoying, because since the voting has been almost 2 years and the transaction did not take place. Time the UK is fast approaching, and if the spring is still the issue will remain unresolved in this case, the country will face the so-called “hard” out of the EU, which will have disastrous consequences for the country’s economy and its international status.
It should be noted an interesting trend that the more we discuss the deal, the more resistance she meets in the Cabinet, and in the community, and probably in the British Parliament, of which a preliminary vote regarding the transaction Brexit is scheduled for tomorrow, Tuesday, December 11.
On the background of total uncertainty, the British pound sterling fell by 3.57% against the dollar since November, and is at the level of its minimum value, previously tested by the price in August and October of this year.
By the way, possible and do without transactions and without breccia. Today it became known that the European court of justice confirmed the right of Britain to abandon breccia unilaterally, that is, Britain can “change your mind” to withdraw from the EU, and for this she will need absolutely no confirmation or consent of the remaining 27 members of the Association.
Probably, this week is the pound sterling would show the greatest volatility, and in case of failure of a vote in Parliament-the GBP/USD has the potential to reduce by 5% by year-end.
About the dynamics of the cryptocurrency market, the price of the leading asset continues slow protorgovki under the previously formed consolidations. In General within the month the market lost half its capitalization – from $224 billion to $114 billion BTC/USD continues its slow decline with the goal to $3100, in the coming days one can expect to achieve this price against the backdrop of another postponement in the US SEC decision on the launch of a Bitcoin ETF, which is now scheduled to hear in February 2019.
Olga Prokhorova,
“International financial center”