A glut of crude may keep oil prices low for the next 15 years, according to Goldman Sachs Group Inc.
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OPEC added the output ceiling would be discussed in its next meeting in 2016. While some parts of the world still depend on oil for daily living, it’s better to invest time and money on clean energy and making the planet that much greener.
According to secondary sources, currently, OPEC countries are producing 31.3 million barrels of crude per day which marks 1.3 million barrels more than the ceiling set for the organization.
“[Opec] agreed that member countries should continue to closely monitor developments in the coming months”, the group said in a statement. There’s less than a 50 percent chance that prices will drop to $20 a barrel, most likely when refineries shut in March for maintenance, Jeffrey Currie, head of commodities research at the bank, said in an interview earlier in September. Brent futures for January were trading 58 cents higher, at $43.07 per barrel.
Iran, which was once the second biggest oil producer in OPEC, has repeatedly stated that it is planning to increase its oil production by 500,000 barrels per day immediately after the sanctions are lifted, and by another 500,000 barrels per day within the following six months.
He said the downward trend stemmed mainly from the impact of investment cutbacks and the drop in United States tight oil output, which had been declining since May 2015.
“Now (that) Iran is starting to produce, we don’t know how much and we can’t define it, so we have to wait and see”, Abdul Mahdi told reporters at a news conference after Friday’s OPEC meeting in the Austrian city of Vienna, The Wall Street Journal reported. We have to accommodate Iran one way or another.
“And $40 a barrel is not good, even for the Saudis”, the analyst added. Russia, Mexico and other big producers outside of the group have given no indication they would agree to any Opec-led supply cuts.
In terms of supply and demand, it was noted that non-OPEC supply is expected to contract in 2016, while global demand is anticipated to expand again by 1.3 million barrels per day.
Saudi Arabia yesterday reiterated its stance that it would be willing to cut as long as non-OPEC also reduces its output.
Despite many member countries plan to lower the production ceiling, Saudi Arabia has demanded reduction in Russia’s production as a prerequisite for decreasing its production, a request which Russian Federation would not concur with.
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OPEC confirmed that Indonesia had returned to the cartel after a near seven-year absence, bringing the number of member countries to 13.
