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OPEC agreed to cut oil output by almost 1.2 million barrels per day, and nearby futures prices rose around $5 a barrel in response. Analysis from Reuters' Kemp suggests the deal will tighten the oil market in 2017, with the rally partly driven by hedge fund short-covering.
A tighter crude market raises energy costs for feed producers and supports biofuel-linked oils. The price gain partly reflects short-covering, so it may be less durable than fundamentals alone.
reuters.comJohn KempDec 1, 2016After 438 past bullish policy events, Crude Oil (WTI) moved a median +0.9% over 5 sessions (61% higher; middle half -2.2% to +4.6%), and +2.0% over 20.
After 442 past bullish policy events, Crude Oil (Brent) moved a median +1.4% over 5 sessions (60% higher; middle half -2.0% to +4.9%), and +2.1% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
