from the Dallas Fed
– this post authored by Rachel Brasier and Martin Stuermer
After two years of defending market share, the Organization of the Petroleum Exporting Countries (OPEC) returned to its old strategy of managing production. Joined by 11 non-OPEC countries such as Russia and Mexico, OPEC aims to cut output by 1.7 million barrels per day (mb/d) in the first half of 2017. This decision sent oil prices up roughly 20 percent during the fourth quarter. Although the output cuts look impressive on paper, implementation is far from assured. The actual effect on the global supply-and-demand balance is likely to be muted.