OPEC plans to lower oil production
The delegates of the organization debate in Vienna the decrease of crude production. Opinions are divided since some of them want to stop the fall in prices and others want to maintain US pressure to keep them downward
Vladimir Putin, Russian president, and Saudi heir Mohamed Bin Salman announced during the G20 in Buenos Aires that they want to renew the agreement to limit oil production. However, the ministers of both countries must convince the rest of the OPEC members to reach an agreement in the meetings of this week.
During the last two months, oil price has dropped by more than 30% and is around 60 dollars a barrel of Brent, which is the reference oil in Europe. But if the group of approximately 20 countries that accounts for more than half of world production continues to extract oil at record levels, the price of crude oil may continue to fall.
On the other hand, if the agreement restricts the production of oil, this decision may eventually hinder growth worldwide, closely linked to its price.
Likewise, Saudi Arabia could confront the interests of the United States, since President Donald Trump multiplied the attacks against the Organization of Petroleum Exporting Countries (OPEC).
According to Energy Aspects analysts: “A low price is not an option for Mohamed Bin Salmán, who needs a more expensive barrel of crude to apply his economic plan.” Therefore, it will be essential to reach an agreement with Trump.
L.Sáenz
Source: Bancaynegocios
