What the experts think about the agreement of OPEC, the rising oil prices and the prospects of the ruble.
for the First time in 8 years, the members of OPEC agreed to reduce oil production by 1.2 million barrels per day to 32.5 million Saudi Arabia needs to cut daily production of 486 thousand barrels to 10.06 million, Bloomberg, citing the text of the agreement. Iraq, the second oil production country in the cartel, will produce 210 thousand barrels less than in October. The United Arab Emirates and Kuwait will reduce daily production by 139 thousand and 131 thousand, respectively. The participants of the OPEC suspended its membership in the cartel Indonesia, its quota will be distributed between the remaining countries.
in addition, the agreement encourages countries not members of OPEC to reduce oil production to 600 thousand barrels per day. Russian energy Minister Alexander Novak that Russia “will gradually reduce the production” in the first half of 2017 to 300 thousand. barrels per day “in a short time, on the basis of technical possibilities.”
the Price of Brent crude on the news, has increased more than 8% and exceeded $ 50 per barrel. Dollar on the Moscow stock exchange at the same time could barely break through the level of 64 rubles, but did not stay there and to the closure of the market was worth 64,14 ruble (-97 cents by the end of the previous trading day).
whether the ruble to grow stronger?
Sergey Romanchuk, head of the dealing center Metallinvestbank:
a Powerful jump in oil prices shows that the market has not fully was confident that OPEC members will agree. However, it is unlikely that the growth of quotations will proceed. Cutting production, OPEC members have change for the price of oil, the share in the market. This was the reason for the skepticism about the agreement of OPEC. The danger of such decisions is clear: with oil above $ 50 a barrel it becomes profitable to drill for shale oil in the US, so there is a risk of losing market share to American manufacturers. In this regard, to predict onset of sharp and constant increase in oil prices would be reckless. The analysis shows that previous experience with increasing the value will increase with $ 55 per barrel is working actively in the infrastructure of the drilling of new wells.
I Believe that in the near future, Brent will cost in the range of $ 49-52.
If the ruble dependent on oil prices, he would have been greater. But on Wednesday, the Russian currency there were two countervailing factors. On the one hand, the rise in oil prices. And on the other the strengthening of the dollar against the currencies of developing countries. In particular, the dollar against the Turkish Lira is at an absolute maximum. This trend continued exit of investors from emerging markets assets – does not allow the ruble to strengthen in proportion to the price of oil. About 64 rubles per dollar – this is the result of two opposing forces.
Vitaly Bagmanov, managing Director, BCS Ultima:
the agreement will definitely have a positive impact on the oil market. But it is important to understand that the impact of this factor will be extremely short immediately for several reasons. First, the decision to reduce the level of production in the conditions when there are strong contradictions in the positions of the cartel members, can be extremely short-lived. Both Iran and Iraq is not ready for full-scale reduction for a number of reasons. Second, not all market participants believe that the agreements will be respected, after all for anybody not a secret that often quotas and actual production levels – they are completely different indicators. In addition, countries outside the cartel, also failed to give clear confirmation about the readiness to a proportional reduction of its own production.
Accordingly, the oil may be fixed at the level above $ 50 per barrel as long as not followed by news about the real situation on the market. If statistics will show that the signs of the reduction of overproduction is not de facto, quotes very quickly return in the range of $ 45-50 per barrel.
the Russian currency, as we have seen, is not so sensitive to fluctuations in oil prices, but, of course, such a strong movement will affect the rate. The rest of the week, we may see the dollar below 64 rubles. But, again, it is unlikely that this trend will be long-term. Most likely, the most probable range in which the Russian currency will be to the end of the year is 65-66 rubles per dollar.
Alexey Kaminsky, lead strategist at the ATON:
for the First time since 2008, OPEC countries failed to agree on joint control over the volume of oil production. The significance of this event cannot be overemphasized, and it is not even so much the specific numbers declining production. While fundamental shifts — reduction of shale oil production due to a sharp decline in prices — has already occurred on the world market again there is a cartel that can really have an impact on the dynamics of oil prices by regulating their own suggestions. Add to this up to $ 1 trillion and the growing demand due to the global economic recovery and get a good basic picture. Recent comments by Russia’s readiness to conduct a coordinated policy with OPEC completes this picture.
however, we do not think that the agreement increases the projected target oil prices. It probably seriously reduces the risk of sharp fall from the current levels. Our basic estimate of $ 55-60 per barrel in 2017, now seems quite realistic and achievable. We do not expect that oil prices will be able to exceed $ 60 per barrel, as above this level the game again “past fire and water” shale producers, who in two years could seriously reduce the cost of production. However, at some point in 2017, we will surely see attempts of oil to go above $ 60. By the end of this year we expect that the oil will lock in the corridor of $ 50-55 per barrel.
We expect that the dollar in 2017 will be in the wide corridor 57-67 rubles. This is primarily due to budget uncertainty for next year. Uverenna and what oil will approach $ 60 per barrel, the higher the likelihood that the strong ruble. As for the value of the dollar at the end of this year, sooner (before the election, Donald trump President) we expect to see the pair dollar-ruble in the fourth quarter around the value of 60-62, but now, it is likely to be above – 62-65.
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