The shocking news consisted of OPEC's agreement to cut output for the first time since 2008. Hedge funds and many others have shorted their positions in futures of WTI and the US crude oil benchmark, merely to find out that the OPEC oil cartel and Russia have froze production.This resulted in chaos for many funds, with their short positions affecting spot oil prices.Since September 28, the oil price has increased 5.32 per cent and there have been 24,131 new contracts going long in NYMEX crude oil, according to Bloomberg.The important message is that the oil market is full of speculators, leading to high volatility. The abolition of the law prohibiting crude oil export has established America as a new oil exporter.Regarding the uptrend in oil prices, the US has emerged with its production, once again due to a favourable environment in shale oil production. This increases the possibilities of a negative impact on oil prices caused by exchange rates associated with the uncertain monetary policies of major central banks around the world. However, developments in these factors are yet to be thoroughly observed.Asset Plus's year-end oil price forecast will be within the range of $45 and $55 a barrel.

Source: The Nation Bangkok October 09, 2016 18:00 UTC