Remember the much-touted oil production "freeze"?
Oil prices tumbled -4% today following an IEA report that OPEC oil production hit an eight-year high last month. This news comes six months after discussions between OPEC and non-OPEC countries to "freeze" production fell apart.
Hedgeye Potomac Senior Energy analyst Joe McMonigle saw it coming. (Click here to read his prescient research note written back in March.) Here's what he said:
"We continue to see no chance of a production cut at this time and maintain our thesis that Saudi Arabia believes its market share policy is winning."
Take a look at the OPEC oil production chart below from Bloomberg. As you can see, Saudi Arabia and Iran have been ramping up production just as McMonigle predicted.