Asia markets waver in lack of major drivers – CNBC
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Oil briefly rallied in the overnight session after Saudi Arabia, Russia, Qatar and Venezuela said they would lead an effort to freeze output at January levels, dashing hopes of a cut in production.
Evan Lucas, market strategist at IG, wrote in his morning epistle, “OPEC nations will freeze production at January levels, which was 43.1 million barrels of oil a day. Interesting, considering January levels were a record and were producing 1 million barrels a day above demand. That, coupled with EIA stockpiling, registered record levels in January.”
This is the first major accord of its type in 15 years, with the last accord in 2001, and the one before in 1998.
Lucas said, “What also makes this accord interesting is that history would suggest Russia is the one to watch. It was the first to break the 2001 and 1998 accords due to ‘not enough action’ taken by other OPEC nations.”
“The agreement is not signed and nor is there signs it will even materialise considering the clause around other nations acting,” he added.
Iran, which re-entered the international market this year after U.S.-led sanctions on the Persian state were lifted, swiftly said it would not reduce its share of the oil market. Reuters, citing sources familiar to the matter, reported that the OPEC member could be offered special terms under a global deal to freeze oil production levels.
Asia markets waver in lack of major drivers – CNBC}