OPEC cannot turn crude “on a dime”

No OPEC meeting has ever marked a major low in crude oil prices, says Walter Zimmermann, Senior Technical Analyst at United-ICAP, who thinks that crude can continue to fall for some weeks or months to come.

Looking at the intersection of OPEC meetings and the five major bear markets in crude over the last 30 years – 1985-86, 1990-93, 1996-98, 2000-01 and 2008 – Zimmermann concludes that no OPEC meeting has, “turned trending Crude Oil prices on a dime. Even after the so-called ‘successful’ OPEC meetings, Crude prices still tend to struggle for a while.”

Zimmermann says it can take from a few weeks to several months to turn the market around, as shown below:

7 – 9 Dec 1985, 76th OPEC Conference
Bottom: Early April 1986

23 – 24 November 1993, 95th OPEC Conference
Bottom: Mid-December 1993

24 July 1998, 106th OPEC Conference
Bottom: Mid-December 1998

26 – 27 September 2001, 117th OPEC Conference
Bottom: Mid-November 2001

24 October 2008, 150th OPEC Conference
Bottom: Mid-December 2008