Producer meeting can’t come soon enough

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Oil is charging higher to start the new week, on the ebb and flow of production freeze rhetoric and adverse developments relating to returning Libyan exports. Hark, here are five things to consider in oil markets today:

 

1) As the meeting of OPEC members looms next week, we are set for heightened scrutiny of rhetoric over the next eight days. (Oh good). Apprehension ahead of the meeting is already manifesting itself in financial positioning; hedge funds boosted their net long positions in WTI last week, driven by the covering of bearish short positions, while bullish long positions were also reduced. 

Given the potential for upside from jawboning (we’re already getting it today from Venezuela, with President Maduro saying a deal could be announced this month to stabilize the oil market), it makes logical sense that hedge funds are moving to the sidelines, sitting this one out. 

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2) We discussed here a month or so ago how Oman would not be participating in next week’s meeting in Algeria, after expressing its disappointment at OPEC’s inability to address low oil prices. Oman is the Middle East’s largest producer who is not in OPEC, producing