OPEC magazine op-ed that fueled oil rally baffles insiders

Tue Sep 1, 2015 1:34pm EDT
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

LONDON (Reuters) - An OPEC publication written by the exporter group's public relations team helped oil prices jump and prompted speculation over a possible shift in output policy - to the bafflement of some OPEC insiders.

The commentary on Monday in the OPEC Bulletin, a magazine issued by OPEC's Vienna headquarters, said downward pressure on prices due to higher production "remains a cause for concern" and OPEC "stands ready to talk to all other producers".

While the 799-word article helped add another 8 percent to oil's three-day surge, by Tuesday it seemed clear there was no sign of a significant shift in OPEC policy or any indication of a fresh push to shore up markets, analysts and OPEC insiders said.

A Gulf delegate said the Bulletin reflected genuine concern in the Organization of the Petroleum Exporting Countries about falling prices but it did not signal a policy shift or pending production cut.

"I see it as a message sent to the market that we are willing to talk to non-OPEC, we are concerned about prices and we are not closing our eyes to what's going on‎."

Another OPEC insider said: "I found it surprising," referring to the jump in prices on Monday. "The Bulletin wasn't saying anything new."

The Bulletin, a glossy magazine, is written by OPEC's PR department based in Vienna and lists 12 editorial staff. It is reviewed by senior officials at the OPEC secretariat before publication.

In the magazine, the following disclaimer appears under the heading "editorial policy": "The contents do not necessarily reflect the official views of OPEC nor its member countries."

While the Bulletin has included similar commentaries on the market before - in April it criticized unidentified non-member countries for not cooperating in propping up prices - it does not tend to move oil prices.   Continued...

The logo of the Organization of the Petroleum Exporting Countries (OPEC) is pictured at its headquarters in Vienna, Austria, August 21, 2015. REUTERS/Heinz-Peter Bader