OPEC members, who surprisingly agreed to the formation of a first major producers’ deal in decades in September might be planning to micro-manage the oil price. Though the concept makes perfect sense, it is not, however, clear, whether it’s possible or not. Any vivid followers of the oil market news would recall Iran saying that they would agree to any measure (production freeze) if that pushed prices to $50-60 per barrel range. It was before the deal and the oil price was then hovering in their 40s. WTI is currently trading at $51 per barrel and Brent at $1.4 per barrel premium over WTI.

Saudi Aramco board member Andrew Gould said that $50-60 per barrel of oil price would be enough to keep the market well supplied with oil over the coming years. While he was pointing to the economic side of it, it is important to note that this range is not coming to the headlines for the first time.

Many of the influential OPEC members including Saudi Arabia and Iran do not want to give away too much in terms of price to the high-cost producers. Keeping the oil price below $60 per barrel is a plan to make the high-cost producers bleed over a longer horizon.

However, it is very hard to think that the oil price could be micro-managed in a tight range.