- The increase in Libyan oil exports creates a dilemma for OPEC, Bernstein analysts say in a note this morning. Output will reach close to 1M b/d this week, the highest in 5 years.
- Sustained production at this level would offset at least 1/3 of the cuts fellow OPEC members and others have agreed to. As a result, it would "take longer to bleed down excess inventories than the 9 months expected."
- However, "while surging Libyan production has put a cap on oil prices for now, the calm often comes before the storm." Many have questioned how long Libya can continue to boost output: “With decaying infrastructure and a fragile peace there are clear downside risks to Libyan production and it would be wrong to extrapolate the recent resurgence in production to anything more permanent,” firm says.
- ETFs: USO, OIL, UCO, SCO, BNO, DBO, DTO, USL, DNO, OLO, SZO, OLEM, DWT, OILK, OILX, USOI, UWT, WTID, WTIU
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