US & OPEC play cat & mouse with crude
From 2011 to late 2014 WTI crude prices remained in an 80-100 $/bbl range, with OPEC supply restraint making way for growth in US shale oil production. In Nov 2014 OPEC abandoned cuts to directly compete against US production for market share. This sent crude prices plunging below 50 $/bbl for most of 2015-16, with marginal US production falling in response. The latest round of OPEC & Russian production cuts in 2017 have supported a recovery in both US production and price. But behind this cat and mouse game, global demand growth remains strong, upstream investment remains low and inventories are declining relative to demand. These conditions are likely to continue to support prices.