Oil rises after OPEC agrees to lift output

Cornelia Mascio
Giugno 23, 2018

President TrumpDonald John TrumpCNN analyst Kirsten Powers: Melania's jacket should read "Let them eat cake" CNN's Cuomo confronts Lewandowski over "womp womp" remark Sessions says Federal Bureau of Investigation agent Peter Strzok no longer has his security clearance MORE has been repeatedly pressuring OPEC to increase production.

Saudi Arabia, backed by non-member Russian Federation, has argued that it is time to raise production in order to meet growing demand and appease major consumer countries like the United States, India and China who have complained about a sustained increase in prices since output was cut back from January past year.

Trump slapped fresh sanctions on Tehran in May and market watchers expect Iran's output to drop by a third by the end of 2018.

Saudi Arabia, supported by Russian Federation, was strongly in favour of pumping more oil to ease fears of a supply crunch and quiet grumbles about the higher prices in major consumer countries like the United States, China and India.

By not setting individual targets, the OPEC deal appeared to give Saudi Arabia the leeway to produce more than its previous OPEC quota and fill the gap left by those such as Venezuela who can not pump enough to meet their official allocation. "Those which can not, will not". The increase in production will be borne largely by Saudi and Russian Federation.

Al-Mazrouei noted that the decision "is challenging for those countries that are struggling with keeping their level of production".

Much of the current production shortfall has come from Venezuela, where an economic crisis has savaged petroleum production. "And if it can not, others can not come in and produce on their behalf", Zanganeh said.

"The effective increase in output can easily be absorbed by the market", Harry Tchilinguirian, head of oil strategy at French bank BNP Paribas told Reuters Global Oil Forum.

Zanganeh has said that if OPEC returned to regular compliance, the group would raise output by around 460,000 bpd.

But unexpected outages in Venezuela, Libya and Angola have effectively brought supply cuts to around 2.8 million bpd in recent months.

He also warned the world could face a supply deficit of 1.8 million bpd in the second half of 2018 and that it was OPEC's responsibility to alleviate consumers' concerns.

"Both Saudi and Iran can show that they won", an OPEC delegate said.

Altre relazioniGrafFiotech

Discuti questo articolo

Segui i nostri GIORNALE