In the aftermath of Bloomberg's surprising Friday report, according to which Saudi Arabia flipflopped on its previous promise that it would freeze its oil output while allowing Iran to grow supply until it hit its pre-embargo peak, instead saying that it would only join the freeze curbe Iran - and all other OPEC member nations - also joined, crude tanked.
Submitted by Eugen von Bohm-Bawerk via Bawerk.net,
The one catalyst most responsible for sending the price of oil from its 13 year lows hit in early February some 50% higher in the following month, has been the recurring rumor about an "imminent" OPEC production freeze meeting which was initially supposed to take place in early March, then on March 20, and now on April 17 (we expect this to be rescheduled shortly as well).
The main catalyst that pushed the price of oil from a 13 year low in early February, when crude briefly traded in the mid-$20 to well over 50% higher less than one month later in one of the world's most furious short squeezes, was the recurring infatuation with the fabricated narrative that OPEC would if not cut production then, then at least freeze it.
We mocked this, as recently as one month ago, when we wrote "About That "Oil Freeze": Russian Crude Production Sets New Post-Soviet Record In February" an article which was self-explanatory:
Around 915ET we tweeted the need for an OPEC meeting headline as oil prices started to accelerate losses. 70 minutes later, the market's "wish" was granted when Algeria (yes, seriously) announced they will attend, Nigeria is hopeful, and Libya said it would not attend... of course any headline is a buying opportunity and the algos went wild...
We tweeted...
WTI CRUDE DROPS 1.6% TO SESSION LOW; S&P FUTURES DOWN 11PTS. quick, need some OPEC meeting headlines