OPEC+ members set about a charm offensive yesterday with the big guns of the pact deployed in a show of unison. If tension exists between Saudi Arabia and Russia over the latter’s admitted non-compliance to voluntary cuts, it did not show as Russia’s Alexander Novak commented that the weekend’s decision “is positive for the oil market and helps stabilise it.”
Only the gullible would be the stubborn advocate of one of the alleged cornerstones of chart analysis, namely that history repeats itself and the same event would repeatedly trigger the same reaction. It has been evident on a frequent basis that a bearish occurrence would less likely trigger renewed selling in a falling market than in a rising one and vice versa.
Should our market hold up reasonably well today, we will be brazenly but nervously calling for a bottom – at least for the immediate future. It might well turn out that what we saw on Monday and yesterday morning, in the immediate aftermath of the OPEC+ decision to roll some of the supply constraints over to 2025 and taper the rest between October 2024 and September 2025 was a defensive action against the unexpected element of the ministerial meeting.
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