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Oil Market Seen as Surprise Haven From Political Risk in 2017

  • OPEC output cut creates capacity to respond to supply outages
  • Slim prospects of big shocks to supply in first half: WoodMac
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Oil in 2017: Where Do Prices Go Next?

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With Donald Trump set to enter the White House in January and populists on the march across Europe, political risk will loom large in 2017. Cautious investors may find stability in an unfamiliar place: the oil market.

A deal between the Organization of Petroleum Exporting Countries and other producers to limit output next year won’t simply siphon off some of the global glut of crude: if participating nations make the cuts they’ve promised, the effort will also add to a buffer of unused capacity that can be tapped to plug supply disruptions.