The Organization of the Petroleum Exporting Countries (OPEC) is set for another showdown between rivals Saudi Arabia and Iran when it meets on Thursday in the Austrian capital, with Riyadh trying to revive coordinated action or a formal oil output target, but Tehran rejecting both ideas.
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Crude oil prices were down once again today, as no consensus on oil production freeze was reached at the Organization of Petroleum Exporting Countries’ (OPEC) meeting in Vienna.
He said Saudi Arabia is not now increasing production capacity, but would not rule it out.
Mohammed Sanusi Barkindo from Nigeria was appointed as new secretary general of the organization and is to take the office on August 1. He replaces Libya’s Abdullah al-Badri, who had been serving as acting secretary-general.
Several OPEC sources said Saudi Arabia and its Gulf allies had tried to propose a new collective ceiling in an attempt to fix OPEC’s waning importance and end a market-share battle that has sapped prices and cut investment.
Saudi oil minister Khalid al Falih said: “We will be very gentle in our approach and make sure we don’t shock the market in any way”.
Qatar’s energy minister expressed confidence that the rebalancing in the market has put a bottom beneath the price of oil, which has almost doubled from $26 a barrel in mid-February to $50 a barrel last week. Until last December, OPEC had a production ceiling of 30 million barrels a day, a mark it routinely exceeded by more than two million barrels a day. Read What’s Saudi Arabia’s State of Mind before OPEC’s Meeting? to learn why.
But Bob Minter, analyst at Aberdeen Asset Management Investment, said the meeting failed to “at least signal that members can agree on something”.
The Energy and Mineral Resource Ministry recorded the growth of the average world crude oil price in May 2016 compared to April 2016 is the increase of WTI (Nymex) price of $5.67 per barrel; from $41.12 to $46.80 per barrel. Yesterday, Brent crude dropped 37 United States cents to US$49.35 a barrel at 1.45 pm in London. One is the mistrust and lack of discipline within the OPEC members and the other is the rise of the non-OPEC supplies.
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Venezuelan oil minister Eulogio del Pino said: “It’s not the situation of the market, it’s the circumstances”. The oil cartel’s closing remarks made no mention of measures to be taken to boost prices but included a statement that the 13 members all pledged to work toward market stability.
