US WTI Crude Oil settled at $ 35.49/bbl, capping off it best month in history with a 88% increase amid an uptick in demand and record production cuts. This month’s surge follows the steepest downturn on record in April, and WTI is still 45% below its recent January high of $65.65/ bbl.
Jefferies Analyst Jason Gammel said ”our concern is that prices have reached a level that does not incentivize curtailments/cuts; this supply- driven rally is at risk if production returns too quickly”. Other analysts worry the rebound in prices could cause some producers to waiver from cuts.
Record Shale Oil producers bankruptcies in the United States have played into the hands of OPEC allies which seeks to preserve prices in the face of steep production cuts.
Nigeria had it production cut to 1.4million barrels per day. The country has sought to balance its books amidst the price pressure, striking a funding aggrement with the IMF for $3Billion. Last week, its parliament agreed to a downward review of 2020 spending bill to 10trillion naira.
The nations currency, the naira has been revalued as speculators and market participant sought to hedge needs against widespread Dollar Shortages.