To Stabilize the Oil Market, OPEC Refines Its Strategy
MIN READMay 26, 2017 | 10:04 GMT
At a meeting in Vienna on May 25, OPEC resolved to extend its production cut for an additional nine months, through March 2018.
(JOE KLAMAR/AFP/Getty Images)
OPEC's production cut is here to stay, at least for now. During a meeting in Vienna on May 25, major oil producers from around the world agreed to extend the measure, adopted in November 2016, for another nine months. The deal was hardly a surprise; many of the oil cartel's key members signaled weeks ago that they supported prolonging the production cut. The main issues at stake were details such as how long to continue it and whether to deepen it by increasing voluntary reductions or including more countries in the deal. By and large, though, the production agreement remained unchanged, and despite the forces working against it, the cut's extension will start restoring balance to the international oil market. Supply will gradually creep back in step with demand. More important, global oil inventories will inch closer to their five-year average levels. But as OPEC, along with major oil producers...