Euphoria … hysteria.
Oil prices have gyrated between the two over the last month as investor speculation ramped up about what OPEC would do with its oil supply. Will they reach an agreement or won’t they? Tomorrow will be pivotal.
The oil cartel’s 14-member countries will release the outcome of a months-long negotiation, and the culmination of its two-day meeting at OPEC headquarters, about whether to freeze oil output at current levels.
Expectations are high. If a deal isn’t reached, oil prices could head significantly lower.
Standing just outside OPEC’s Vienna headquarters in the video above, Hedgeye Potomac Senior Energy Policy analyst Joe McMonigle provides this essential update (part 2 of McMonigle’s OPEC coverage, click here to read his previous dispatch):
“Everyone is viewing the meeting tomorrow through the lens of how desperate the Saudis want or need a deal. If you think they’re desperate then you think there will be a deal. If you don’t think they’re desperate then there’s a possibility there won’t be a deal or some kind of freeze or face-saving deal.”
McMonigle remains skeptical about whether a deal will ultimately get done. “We don’t think [Saudi Arabia] is desperate for a deal, but that there could be some kind of freeze without any real enforcement mechanism.”
If you want to get up to speed on the latest OPEC oil developments, check out our piece, “A Primer Ahead of OPEC’s Critical November Meeting” in which former Secretary of Energy Spencer Abraham discusses what’s on the table at the current meeting in Vienna.