All Eyes On Saudi Arabia As OPEC Begins To Unravel

3 May 2017   OPEC, Saudi Arabia

Has OPEC failed? That’s the question analysts have begun to ask , approaching the group’s next meeting later this month. When the members gather at their headquarters in Vienna, it will likely be to agree on an extension of production cuts in place since January. Those cuts, originally intended to re-balance markets and boost prices, had an initial positive effect but their ultimate impact has been difficult to measure, as inventories have declined only gradually while global oil shipments have increased. New production from outside of OPEC, particularly in the United States, has kept global inventories high. It’s generally believed that OPEC members will recognize the need to extend cuts, with one observer calling it a “ 100 percent ” probability. There is some speculation that Russia, a non-OPEC state whose cooperation is crucial to the overall success of OPEC’s strategy, may prove intransigent when it comes to cutting […]

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