VIENNA, June 1 Venezuelan energy minister Eulogio Del Pino said on Wednesday OPEC has a de facto oil output freeze as its overall production stood steady in the past few months.
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Price of oil declined over one percent today as output from key Middle East exporters was seen to remain high or even rise just as worries regarding the Chinese economy weighed on its crude demand forecast.
Opec’s oil output fell in May from near a record high, a Reuters survey found on Tuesday, as attacks on Nigeria’s oil industry and other outages outweighed increases in Iran and Gulf members.
The group convenes on Thursday in the Austrian capital for its first meeting with Saudi Arabia’s new oil minister, a close ally of prince Mohammed bin Salman, who has been outspoken about not reducing oil production to defend market share. All have vowed to ramp up their supplies to Asia and all will continue to compete for market share. But in the current cycle producers led by kingpin Saudi Arabia have changed strategy, maintaining output even with lower prices in order to pressure United States shale producers.
The recent recovery in prices has eased pressure on the group to turn down the taps at this week’s gathering, analysts say. Data from April indicates that oil demand from the country is declining.
According to reports, OPEC member states have produced 32.439 million oil barrels a day in April.
On the other hand, other developments are expected to have an impact on oil prices, such as Canadian producers planning to resume production by the end of week; higher output from Iraq, Saudi Arabia, Kuwait, Iran and UAE; higher USA demand with the summer driving season; continued supply disruptions in Nigeria and potential US shale output resumption with oil at $50 a barrel. He also said on Twitter OPEC’s policy of giving the market time to balance itself has proven to work but it still needs some time.
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Speaking about the selection of new OPEC’s Secretary General, Zanganeh said that there are sever candidates for this post and Iran would vote for the most competent candidate. Saudi Arabia backed out of the deal, insisting that Iran, which has been boosting oil production after years of global sanctions, should be part of any production cuts. It said then that it would join the deal, which would also have involved non-OPEC Russia, only if Iran agreed to freeze output. “The issue of output rationing can be discussed after the market stabilizes”, Asali said.
