OPEC and the Three Bears

The Week Ahead

May 28, 2018

Could June 22nd be a Goldilocks moment for Canadian financial markets? That’s when OPEC sits down to discuss production quotas, and there’s much at stake for oil prices, interest rates and inflation ahead.

The last two market-moving OPEC meetings played out very much along the lines of the children’s story. Back in November 2014, OPEC failed to cut production as WTI oil prices fell from lofty levels towards $70/bbl. The result was an oil market that, like Mama Bear’s bowl of soup, was too cold, sending Canada’s oil-producing provinces into recession and forcing the Bank of Canada into rate cuts.

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