Speculation is mounting regarding some deal on cutting or freezing oil production. OPEC and perhaps non-OPEC members are set to meet later this month, and some believe that maybe, this time, they will reach an agreement.
WTI Crude oil is making an impressive recovery from the lows, topping $46. Canada, which exports oil, sees its currency recover as well. USD/CAD is now trading at 1.2920, just above the support line of 1.2910.
The latest speculation regarding a move to lift oil prices comes from China. On the sidelines of the G20 Summit, the Saudis and Russians have agreed to meet at the next OPEC meeting. These countries will also make a joint statement.
Update: Russia and Saudi Arabia have agreed to talk about stabilizing the oil market and this may or may not include a potential production freeze. Given past experience, this could end in nothing. Oil prices are off the highs and USD/CAD is off the lows.
Meeting and talking don’t add to up to agreeing on something. And agreeing does not imply implementation of the agreement. But for now, oil is on a roll.
USD/CAD was already sliding late last week on the disappointing US jobs report. The miss on job gains, as well as wages, reduced the chances of a rate hike in the US later this month and this hurt the greenback.
Further support awaits at 1.2830, followed by 1.2750. Resistance is at 1.30.
And here is how WTI crude oil looks. It’s quite a turnaround:
Share
