OPEC unlikely to give up despite losing its pricing power, says Commerzbank

OPEC's limited impact on oil prices since securing a landmark deal to curb oversupply shows its dwindling influence in the energy market, according to the head of commodities research at Commerzbank.

The Organization of the Petroleum Exporting Countries (OPEC) and other producers, including Russia, agreed to slash output by almost 1.8 million barrels per day in the first half of the year. The historic deal was struck in an attempt to remove a supply overhang which has depressed prices to less than half their 2014 highs.

OPEC appears poised to extend supply cuts beyond the middle of the year when the 13 member cartel meets on May 25 in Vienna. However, many analysts and investors have grown increasingly cynical as to whether a prolonged period of production cuts could spur a rally in oil prices towards the $60 a barrel level

Oil prices were trading flat on Friday as oversupply concerns appeared to cancel out any optimism over a potential deal from OPEC to extend production cuts until the end of the year.

Source: Bloomberg

Jr Trader Ivan Ivanov

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