“I will be doing a lot of shuttle diplomacy with the (president)… of Opec to see how we can engage Saudi more, engage Iran more”.
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Leading financial institution Citigroup, noted to its clients that Saudi Arabia was targeting 500,000 barrels per day in new sales to take its daily production up to a minimum of 11 million barrels per day.
Regional political rivals Saudi Arabia and Iran seem to be ramping up output in a race for customers, after sanctions were lifted on Iran, says Reuters. “Additional gas supplies this year are expected from the Wasit gas processing facility following the start of the Hasbah and Arabiyah offshore gas fields”.
According to Pimco portfolio manager Greg Sharenow, OPEC members did not come to an agreement following their meeting in Doha last week, rejecting to “freeze” output.
Minister of Petroleum Resources Ibe Kachikwu disclosed this in a statement reaching Xinhua in Lagos, Nigeria’s economic hub, saying that in spite of the stalemate on crude oil production freeze at oil producers meeting in Doha, OPEC would chat a way forward.
For now, Iran has increased oil exports by 750,000 b/d to 1.7 mb/d since January mostly thanking to the 30-50 million barrels of stored oil on water, but the figure is more much than the production growth. “Wood Mackenzie reckons that the backlog of excess DUCs will decline over the next two years, and return to normal levels by the end of 2017”, the article states.
Kuwait’s oil production is nearly back to capacity one day after a strike by workers ended. “To get a coordinated cut, you have to get cooperation between the Saudis and Iran”, said Tom Kloza, global head of energy analysis for the Oil Price Information Service.
Saudi Arabia will see the biggest drop this year in the oil price needed to balance its budget as Riyadh curbs spending amid the crude-market rout.
“But in my view, the failure of the previous talks in Doha has damaged OPEC’s credibility”, Aw said, adding he was not hopeful of an agreement in June.
West Texas Intermediate crude traded up about 1.3% Friday morning to $43.73, a barrel after closing on Thursday at $43.18.
At 10.30am United Kingdom time, Brent crude was down 51 cents on its last closing price, at $44.60 a barrel. Iran, which is vowing to raise output to pre-sanctions levels, had dismissed the notion that it would take part as “ridiculous”.
When both oil producers pump up more and more oil, how will prices rise?
Our research tells us that around three quarters of global senior oil and gas executives regard OPEC policy as the most significant geopolitical concern for oil and gas businesses in 2016.
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“What is clear coming out of this is that OPEC would no longer be the main driver of oil prices”, Lee told AFP.
