Goldman Sachs sees 84% compliance with OPEC cuts - BBG

Analyst at Goldman Sachs, Damien Courvalin, noted in its latest report that he sees 84% chance that the OPEC and non-OPEC members will abide by the OPEC oil output cut deal struck last month, Bloomberg reports.

According to a Bloomberg graphics, as cited by oilprice.com, the Brent futures curve has moved into backwardation, suggesting that the OPEC’s efforts to slash inventories and stave off en masse shale production may be working, a Bloomberg graphic showed. 

Key Quotes:

“Normalization of inventories is key to low-cost producers”

“It generates backwardation, which removes hedging gains from high-cost producers and helps low-cost producers grow market share”