OPEC Members Pledge to Cut Oil Production

On Christmas Eve, WTI oil fell by 6% to below US $ 43 per barrel. For its part, the Brent, the reference used by Colombia, fell in a similar way and stands at US $ 50. Although the Organization of the Petroleum Exporting Countries (OPEC) signaled that it could extend or even deepen the production reductions to raise prices, the markets highlighted more worries about the increase in US supplies and about the lower global growth by the trade war between China and the US

Officials from Iraq, Kuwait and the United Arab Emirates agreed with Saudi Arabia’s expectation that the group will extend its cuts for another six months. However, they will have to deal with US producers, who added 10 oil platforms last week, bringing the total to 883 platforms.

Energy Minister of the United Arab Emirates, Suhail Al Mazrouei, while emphasizing that the reduction of 1.2 million barrels per day by OPEC and its allies will eliminate excess supply in the first quarter, suggested that analyze additional cuts However, investors remain skeptical.

Donald Trump’s trade war with China and the Federal Reserve’s tariff policy are raising concerns about global economic growth. Oil prices have collapsed 40% since they reached their highest level in four years at the beginning of October.

“The main contribution during the weekend has been the continued intervention of OPEC members, for now, these statements are ignored by the market because we are in this downward cycle,” said Olivier Jakob, CEO of Petromatrix.

The Energy Minister of the United Arab Emirates said that OPEC has the option of holding an extraordinary meeting to decide on further production cuts if the current reduction is not enough. At a press conference in Kuwait, the ministers of Iraq, the United Arab Emirates and Algeria took turns to repeat the message that OPEC will comply with its production restrictions and will continue to work with its allies.

About the author

Angela Nagata

Angela Nagata is a reporter for De Lune. After graduating from NYU with a master degree in history,Angela got an internship at WABC-TV New York and worked on profiling local businesses across the city.

Add Comment

Click here to post a comment

Your email address will not be published. Required fields are marked *