Can Saudi Arabia Carry OPEC Through Spring?

16 Feb 2017   OPEC, Saudi Arabia

Faced with budget strains amid low oil prices, Saudi Arabia ditched its pump-at-will policy and brought together the diverse group of OPEC nations to agree to production cuts late last year. Now the cartel’s de facto leader and largest producer is going the extra mile in reducing output, at least in January. The Saudis pledged the biggest cut in the November 30 deal , and last month went beyond the required amount to ensure a high rate of compliance. Initial estimates by the International Energy Agency (IEA) and OPEC itself show that the cartel’s early compliance to cuts is very high: more than 90 percent. The unexpectedly high rate is almost solely courtesy of Saudi Arabia. Bloomberg estimates — based on IEA and OPEC figures — show that just three out of 10 OPEC members that had promised cuts managed to reduce their output to target production levels in […]

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