Oil trading: Buy the soundbites, remain net short - IB Times

Gaurav Sharma, Editor and Oil Analyst at IB Times says only Saudi Arabia can scale back its production…paving way for an output cut deal as the latest evidence suggests Libya, Iraq and other OPEC members are unlikely to curb output. Sharma believes the upside in oil prices could be restricted around $60, while the downside is likely to be capped around $45-48 levels.

After watching this segment, viewers would be convinced that it is safer to remain on the shorter side of the story but retain enough flexibility so as to play bullish OPEC soundbites

Key points

OPEC soundbites have propped up price

Only people who would benefit from the output cut deal and the resulting rise to $60 levels are the North Amercian suppliers

Saudi-Russia credibility is at risk…if the deal doesn’t come through, markets would have a hard time trusting the bullish soundbites in future. Moreover, this is the third attempt to reach a deal