Futures Wipe Out Most Overnight Losses Following Dramatic Rebound In Crude

Following yesterday’s OPEC “production freeze” meeting in Doha which ended in total failure, where in a seemingly last minute change of heart Saudi Arabia and specifically its deputy crown prince bin Salman revised the terms of the agreement demanding Iran participate in the freeze after all knowing well it won’t, oil plunged as much as 7%, and with it the strategy of jawboning for the past 2 months had been exposed for what it was: a desperate attempt to keep oil prices stable and “crush shorts” while global demand slowly picked up.
As a result what followed was crude’s biggest drop in months, a plunge of some 7% in the early Sunday trading hours, which also dragged down US equity markets and currencies of commodity-exporting nations. Furthermore, as can be seen in the chart below, with oil the most important commodity for global stock prices, many wondered if central banks would allow this drop to persist: after all by now everyone knows central banks’ only mandate is keeping asset prices propped up.

This post was published at Zero Hedge on 04/18/2016.