Saudi Arabia’s gamble has failed. That, rather than the spike in oil prices, is the real story to emerge from the agreement reached by Opec’s 12 members that they must agree to cut production.
Let’s be clear, a deal to actually restrict the flow of crude oil onto the global energy market has not yet been reached. Opec has said that something needs to be done, and has made a vague commitment to trim between 500,000 to 1m barrels a day from current output, but it has yet to flesh out the details.
As one analyst rightly noted, Opec seemed to have been taking lessons from EU summits. It has agreed that something needs to be done, but has put off until another day the rather more difficult task of getting its fractious membership to decide what that should be.
