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LONDON — European stocks were mixed on Thursday as market participants looked beyond reports that OPEC has — as expected — agreed to extend production cuts.
Several news outlets report on Thursday that the cartel of major oil producers agreed to continue the cuts in a further effort to rebalance the oil market and address the global supply glut that has subdued prices, citing delegates at OPEC’s meeting in Vienna
The extension, which is yet to be officially confirmed, means that cuts will now continue until March 2018.
OPEC agreed to keep its own cuts of around 1.2 million barrels per day in place for nine months, Kuwaiti Oil Minister Essam al-Marzouq said, according to Reuters.
European stocks were pretty non-plussed by the news, with no major index moving more than 0.6% on the day:
Writing in an email early on Thursday morning, FXTM analyst Lukman Otunuga said:
“Oil prices were heavily supported this week by the growing optimism over major oil-producing countries working together to eliminate oversupply woes. With markets widely expecting OPEC and Non-OPEC members to extend the current output cut deal by another nine months, compliance is likely to be the main focus of today’s meeting.
“With compliance still a grey area, it will be interesting to see if OPEC enacts penalties in the new deal to prevent other members from cheating or going against the agreement.”