Life is just one darned thing after another. Investing even more so, going by recent events. Just when it seemed the after-shocks of the global banking crisis had subsided, markets were hit by another thunderbolt – this time from the OPEC+ cartel.
The Organization of the Petroleum Exporting Countries (OPEC) and their allies, including Russia, on April 2 stunned global markets by announcing production cuts of about 1.16 million barrels per day (bpd).
This was on top of the 2 million bpd cuts declared in October 2022. The latest OPEC decision along with Russia’s voluntary production cut of 500,000 barrels per day will take a total of 3.66 million barrels off the market — roughly 3.6 percent of the total world supply.
As investors scrambled to digest the latest geopolitical flashpoint, global oil benchmark Brent shot up over 6 percent on April 3 – the biggest one-day jump in a year — to about $85 per barrel. Financial analysts, who just a few days back were wagering on softer crude prices amid the banking crisis, suddenly saw their rosy projections being ambushed by reality.