The group has pumped more than its collective target of 30 million barrels a day the past 18 months, data compiled by Bloomberg show.
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Well, OPEC’s secretary general says there was no consensus on how much oil Iran will add to the market next year due to the pending lift of sanctions.
He disclosed that world oil demand this year grew by 1.5 million barrels per day, up from 1 million barrels per day last year.
“News yesterday that Saudi Arabia lowered their offer prices into the United States supports the view that Saudi Arabia has no intention of cutting output and relinquishing any market share”, ANZ bank said on Friday.
On the New York Mercantile Exchange, January West Texas Intermediate crude dropped $1.11, or 2.7%, to finish at $39.97 a barrel, after touching a $39.60 low.
There’s been a lot of speculation over the past few days about whether the Organization of the Petroleum Exporting Countries (OPEC) will seek to limit oil production when it meets Friday in Vienna.
“The market did not take the announcement out of OPEC very well today as OPEC appears to really be in disarray among its members and they took the path of least resistance, which was to do nothing and wait to see if things get better”, said Andy Lipow of Lipow Oil Associates.
Stiff Iranian opposition to any attempt to rein in its oil production left the OPEC oil cartel divided and unable to agree on a plan of action at a meeting December 4.
Iraq’s Minister of Oil Adil Abd Al-Mahdi speaks to journalists prior to the start of a meeting of the Organization of the Petroleum Exporting Countries, OPEC, at their headquarters in Vienna, Austria, Friday, Dec. 4, 2015. This is believed by many market watchers that it signals a production increase that could heighten global supply of oil that already is approaching oversupply.
Opec yesterday confirmed that Indonesia had returned to the cartel after a near seven-year absence, bringing the number of member countries to 13. OPEC also needs to prepare for increased shipments from Iran when worldwide sanctions are lifted.
OPEC’s poorer members have been piling pressure on OPEC’s wealthier members led by Saudi Arabia to curb supply. “And also the production changes from time to time”, he said.
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But the Saudis and their Gulf allies have been sticking to their strategy of defending market share – hoping that lower prices may ultimately drive higher cost producers such as USA shale firms out of the market.
