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Analysis: Russian oil cap is hidden ace in OPEC deal

Everyone's attention has been directed at OPEC in the wake of last week's oil deal. But the market seems to have overlooked that the perhaps most important element did not come from an OPEC nation, writes analyst agency S&P Global Platts. A major hike in the oil price could be imminent.

Photo: /ritzau/Nabil al-Jurani/Arkiv

All attention was on the Middle Eastern countries – Saudi Arabia in particular – when OPEC reached agreement last week to reduce oil production by 1.2 million barrels a day in the first half of 2017. A deal which has triggered a major increase in the oil price and renewed faith in the global oil market.

But to a great extent, the market has focused on the wrong half of the deal. Because while it was more or less expected that Saudi Arabia would agree to a cap on its oil production, it is much more surprising that several oil producing nations outside of OPEC have agreed to reduce their output, assesses global analyst agency S&P Global Platts.

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