Saudi Arabia’s energy minister has warned that oil prices could fall to $50 per barrel if the OPEC+ members who violate the agreement do not maintain agreed production limits. This was announced by representatives of the group, writing the American newspaper The Wall Street Journal.
Other representatives interpreted these statements as a hidden threat from Saudi Arabia: the kingdom is ready to start a price war to maintain its market share if other countries do not comply with the OPEC + agreements.
The main members of the alliance, which includes the Organization of the Petroleum Exporting Countries (OPEC) and its allies, plan to discuss the possibility of reducing production curves in December at an online meeting on Wednesday.
After Iran fired missiles at Israel on Tuesday, oil prices rose after weeks of steady declines. Brent crude, the international benchmark, rose 5% but ended 2.4% higher at just under $70 a barrel.
The West fears that the wider conflict could cut off oil exports from the Persian Gulf, which passes through the Strait of Hormuz which borders Iran. This will definitely lead to an increase in prices.
However, geopolitical tensions have continued for months without a significant impact on oil prices, and this has alarmed Saudi officials. That’s partly because other cartel members didn’t stick to plans to curb production for most of this year.
In a conference call last week, Saudi Energy Minister Prince Abdulaziz bin Salman warned other producers that prices could fall to $50 a barrel if they do not implement agreed production cuts.
According to OPEC representatives who were present at the call, he specifically mentioned Iraq, which exceeded quotas by 400,000 barrels per day in August, and Kazakhstan, which plans to increase production by restoring the field Tengiz oil to 720,000 barrels per day.
The Saudi message was: “There is no need to increase production if there is no place on the market,” said one representative “Some people should shut up and honor their obligations to OPEC+.” “
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Assessment 4.4 from 32 voice
2024-10-02 18:21:33
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