It seems that a search for a bottom in global crude dynamics eventually became successful. Experts at the International Energy Agency supposed that oil prices passed their lowest point. A report from the IEA looks at recovery of oil quotes to $40 a barrel from $28.5 a barrel. Such a sharp surge was supported by a possible output freeze agreement and rumors about disruptions in black gold shipments from Iraq, Nigeria, and the UAE. Besides, a decline in production in non-OPEC countries had a positive impact on crude prices.
Pundits at the IEA pointed out that even successful output freeze at January levels could not guarantee a rise of oil prices. The point is that in January the majority of producers, except for Iran, hit maximum output levels; it means the freeze is only cosmetic. That is why Iran refuses to join the project as it will be the only country freezing its production at lows. “Later this month some oil producers are expected to meet to discuss a possible output freeze. We cannot know what this might be and in any event it is rather unlikely that an agreement will affect the supply/demand balance substantially in the first half of 2016,” the IEA report reads. The Agency also warns that the current price recovery should not be considered a "definitive sign that the worst is necessarily over."
