USOil surged to $54.09 highs, up from near $51.50 earlier in the day. The move comes as OPEC+ have apparently agreed to cut production by 1.2 mln bpd, 800k bbls from OPEC, and 400k bbls from Russia and non-OPEC producers. The Street had been looking at cuts of 1.0 to 1.4 mln bpd to balance the market, so this outcome should provide some medium support to oil prices. Monday it was 1.3 mln, agreed between Saudi and Russia, this was followed by 800,000 later in the week and complete deadlock within OPEC yesterday.
The collapse in Oil prices from early October may now have bottomed, however, the 20-day moving average remains key for many traders and investors. A strong floor has been established at $50.00 the rally to $54.00 today could be held in check by this popular indicator. Today’s close will be interesting.
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