Well now it’s getting interesting. The Iranian oil minister has said Iran now, “backs any measures which help stabilise the market.” He was talking about the Saudi-Russian brokered deal to freeze global oil production at current levels. Doha now less of a dud!
I referred to the deal – which includes Venezuela and Qatar – as a “dud” because it didn’t stick. But even with Iran’s backing, it’s hard to see how the production freeze will make much difference in the long term. If global oil demand doesn’t pick up, you still have a massive supply glut.
But in the short term, in the world where traders live, the deal is generating some interesting price action. Brent crude futures were up 7.2% and hit an intraday high of $34.99.