After June’s disastrous OPEC meeting, the expectation was that December would have more fireworks in store, as acrimony between Iran and the Sunni gulf states remained high, Iran’s Presidency of the cartel continued and the divide between Saudi and producers with tight budget margins seemed unbridgeable.
However, Iran’s OPEC delegate, Mohammad Ali Khatibi, has recently raised hopes of a truce between supply ‘hawks’ and ‘doves’ at the next OPEC meeting on Wednesday this week.
Khatibi, speaking to Reuters on Saturday, has branded the current balance of oil supply and demand “balanced,” echoing the sentiments of GCC producers and OPEC Secretary-General Abdullah el-Badri.
“The market is relatively balanced […] my feeling is there is a general sentiment among the OPEC members to make a decision based on the real needs of the market,” Khatibi told Reuters. “This meeting, there will be an agreement, I think. We don’t have big differences, really.”
On 22 November, el-Badri said “the market is currently balanced, prices are comfortable and I think we are going to the meeting with a positive atmosphere.”
“The market is balanced,” Saudi Oil Minister Ali al-Naimi told Bloomberg on 7 December. The kingdom is prepared to maintain supplies at November levels “if customers want the same thing in December.”
Even Venezuela, whose budgetary profligacy requires high prices, may avoid rocking the boat, with the Associated PRess reporting today that Hugo Chavez has called current prices are “fair.”
Wednesday’s meeting mat yet be a rare moment of calm in regional diplomacy, amid increasing sanctions against the Iranian regime, the rapid return of Libyan oil production to more than half its pre-war level and oil prices with even Bob Dudley, BP CEO, says are negatively impacting economic recovery in advanced economies.
Brent spot prices have ranged between $113 and $106 a barrel over the last month, and are $108 at the time of writing, with WTI between $102 and $96 and at $100.
Khatibi comment marks a retreat from Iran’s position in November, when the country’s oil ministry’s website Shana reported Oil Minister Rostam Qasemi saying the re-entry of Libyan crude to world markets meant a cut is called for.
Part of the reason for calm is that all sides have signaled that talks over renewed quotas – which are long out of date – will not be tabled for December.
The widened gap between the quotas and actual production poses a threat to OPEC’s credibility unless the cartel can provide markets with a serious resolution to bring quotas in line with reality in the near future. Markets may welcome an absense of strife on Wednesday, but without the ratification of current production, any accord will constitute an agreement to disagree.
OEPC’s overall quota (country-by-country quotas have not been published sonce 2008) is 24.84 million barrels per day, with actual standing at 27.32 million.
Saudi Arabia in particular has been exceeding its quota, recently announcing that it is pumping over 10 million barrels per day against its quota of 8 million, and up from 9.4 million in September after the end of the US driving season.
Staff Writer
Lorem Ipsum is simply dummy text of the printing and typesetting industry. Lorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and...
More by Staff Writer
OPEC meeting lookahead: Could peace break out?
Recent statements from Tehran raise possibility of harmonious meeting
After June’s disastrous OPEC meeting, the expectation was that December would have more fireworks in store, as acrimony between Iran and the Sunni gulf states remained high, Iran’s Presidency of the cartel continued and the divide between Saudi and producers with tight budget margins seemed unbridgeable.
However, Iran’s OPEC delegate, Mohammad Ali Khatibi, has recently raised hopes of a truce between supply ‘hawks’ and ‘doves’ at the next OPEC meeting on Wednesday this week.
Khatibi, speaking to Reuters on Saturday, has branded the current balance of oil supply and demand “balanced,” echoing the sentiments of GCC producers and OPEC Secretary-General Abdullah el-Badri.
“The market is relatively balanced […] my feeling is there is a general sentiment among the OPEC members to make a decision based on the real needs of the market,” Khatibi told Reuters. “This meeting, there will be an agreement, I think. We don’t have big differences, really.”
On 22 November, el-Badri said “the market is currently balanced, prices are comfortable and I think we are going to the meeting with a positive atmosphere.”
“The market is balanced,” Saudi Oil Minister Ali al-Naimi told Bloomberg on 7 December. The kingdom is prepared to maintain supplies at November levels “if customers want the same thing in December.”
Even Venezuela, whose budgetary profligacy requires high prices, may avoid rocking the boat, with the Associated PRess reporting today that Hugo Chavez has called current prices are “fair.”
Wednesday’s meeting mat yet be a rare moment of calm in regional diplomacy, amid increasing sanctions against the Iranian regime, the rapid return of Libyan oil production to more than half its pre-war level and oil prices with even Bob Dudley, BP CEO, says are negatively impacting economic recovery in advanced economies.
Brent spot prices have ranged between $113 and $106 a barrel over the last month, and are $108 at the time of writing, with WTI between $102 and $96 and at $100.
Khatibi comment marks a retreat from Iran’s position in November, when the country’s oil ministry’s website Shana reported Oil Minister Rostam Qasemi saying the re-entry of Libyan crude to world markets meant a cut is called for.
Part of the reason for calm is that all sides have signaled that talks over renewed quotas – which are long out of date – will not be tabled for December.
The widened gap between the quotas and actual production poses a threat to OPEC’s credibility unless the cartel can provide markets with a serious resolution to bring quotas in line with reality in the near future. Markets may welcome an absense of strife on Wednesday, but without the ratification of current production, any accord will constitute an agreement to disagree.
OEPC’s overall quota (country-by-country quotas have not been published sonce 2008) is 24.84 million barrels per day, with actual standing at 27.32 million.
Saudi Arabia in particular has been exceeding its quota, recently announcing that it is pumping over 10 million barrels per day against its quota of 8 million, and up from 9.4 million in September after the end of the US driving season.
Staff Writer
Lorem Ipsum is simply dummy text of the printing and typesetting industry. Lorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and... More by Staff Writer
Related