Monday , September 26 2022

Oil producers want a "new strategy" for over production – International


The main oil producers on Sunday called for a "new strategy" based on a production adjustment to address the imbalance between supply and market demand.

At the end of a meeting in Abu Dhabi between member countries and members of OPEC, producers said that production growth in 2019 would be higher in demand in the world, so they evaluate "the options to make adjustments to the production and New strategies to balance the market might be needed ".

The answer would be to consider "options for new production modifications in 2019, which may require new market balance strategies," they said in a statement at the end of the meeting.

Khalid al-Falih, Saudi Arabia's largest producer energy minister, Saudi Arabia, said the kingdom will reduce its production by 500,000 barrels a day.

Russia, world producer number 2, said he would commit to any new contract between producers to cut output.

Suheil al-Mazrouei, the energy minister of the host, the United Arab Emirates, also gave signs that there must be a cut in production.

"A new strategy needs to be made … whether it's a new production cut or something else, but not an increase in production," he said.

A decision is expected at the next meeting of OPEC ministers and other countries in Vienna on 5 December.

Falih said they will decide on this occasion if they modify the production and size.

Suddenly oil fell – losing one-fifth of its worth – only one month after its top price in four years in October.

Energy ministers from countries such as Russia, Om, Kuwait and Arglia were among those present in the region.

Saudi Arabia makes 10.7 million barrels a day since October, said Valley.

Prior to the meeting, he admitted that there was still no agreement on cuts in production among members of this group, who reached a consensus at the end of 2016 to reduce the extraction to 1.8 million collecting a day to deal with crisis of excess supply.

"There is still no consensus among producers," he says, adding "we should study all the factors."

– Fall of price surprised & # 39; – –

Brent barrel was sold under $ 70 on Friday for the first time since April. West Texas Intermediate (WTI) was below $ 60 – a minimum in nine months.

In its opening address, Valley said the fall in prices "surprised us" and that that feeling in the market was moving from fear of overloading.

The latest drop in prices comes after the US has increased the production of shale oil, while Saudi Arabia, Russia and other countries have increased supplies in slow demand signs.

There are also signs that US new penalties on Iranian oil exports could have a weaker impact than expected.

"Prices rise in steady increase in the supply of oil by large producers such as Saudi Arabia, Russia and the US, are more than offsetting losing Iran barrels," said Fawad Razaqzada, a Forex analyst. com, AFP.

"As Iran's penalties are not as serious as they were initially scared, OPEC producers authorities and OPEC officials could discuss over the weekend the need to reduce compliance … or endanger drop-in prices, as in 2014".

The producers operated large cuts from the beginning of 2017 and managed to raise oil prices of less than $ 30 per barrel to more than $ 85 per barrel in October, significantly improving their revenue.

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