It’s been another week of upbeat OPEC reports—from secretary general Mohammed Barkindo’s belief that global oil demand will jump to over 100 million bpd by 2020 to the proud announcement that compliance with the oil production cut deal had hit 120 percent in September—but is the most recent rally sustainable? These announcements do have an impact on prices, but their effects are often short-lived, especially when facts of life prove them wrong. For starters, any supply or demand announcement from an organization such as OPEC needs to be taken with not one but two grains of salt. The cartel knows very well that an upbeat message could—and often does—send prices higher. Barkindo, for instance, gave no foundation for his forecast of oil demand growth. Neither did OPEC’s monitoring committee go into detail about the 120 percent compliance rate. In truth, this record-high compliance rate covered all partners in the […]