As an apparent wave of populism sweeps through the world, Theresa May prepares to trigger Article 50, and fears of a trade war between China and the U.S grow, financial markets are on edge. But alongside this uncertainty, there has been some good news for markets as well, with oil markets moving towards rebalancing. The recent OPEC production cut agreement, and the additional cuts by non-OPEC countries caused oil prices to touch a post-2014 high. But Saudi Arabia and Russia, among other oil producers, are now in the limelight, as the world waits to see how true to the agreement each country will remain. Perhaps more important at this point are those countries who were never part of the agreement, or who were absolved from it.
One such country is Libya; its rising oil supply can easily offset the effect of the proposed production cut. Recently, oil exports from Libya's key oil terminals Es-Sider and Zueitina were resumed. This could bring 270,000 bpd back to the market, which is just a taste of how Libya, if peace prevails, could increase its production. The addition of 270,000 barrels alone accounts for almost a quarter of the OPEC production cut.
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