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Sunday, 19 March 2017

OPEC's Cuts Are Treading Water - Bloomberg Gadfly

OPEC's Cuts Are Treading Water - Bloomberg Gadfly:

"The first place that OPEC's output cuts ought to show up is in the volume of oil moving across the world's oceans from producing countries to consumers. That is happening, but more slowly than we might reasonably expect. It looks like it will be a while before global inventories are back to levels that OPEC's comfortable with.Most of the group's crude is exported by sea. This means any reduction in supply should quickly show up in a smaller volume of crude in ships leaving member nations.The agreed cut of about 1.2 million barrels a day, if translated barrel-for-barrel into exports, means we ought to see the volume of oil in transit fall the same amount. So, in the first 70 days of this year, we ought to have seen it fall by about 84 million barrels -- all other things being equal."

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