Speculations Thrive as OPEC Meets to Debate a Group Cut in Crude Prices1:31 pm
Time flies when OPEC pettily disagrees over crude oil production. It seems like it’s only been a few days since OPEC’s last meeting in Algiers, in September. Yet, its next much-anticipated conference has arrived. This morning, representatives of the Organization of the Petroleum Exporting Countries, began their mutual meeting in Vienna, in order to try to decide over a uniform cut in oil production. At least, that’s what they’re all hoping for.
It’s challenging enough, at times, to make these types of monumental economic decisions when it comes to just one country. So why would 14 different oil-manufacturing countries want to commit themselves to such a burdensome task of mutual compromise? The answer is simple: money. Or, a bit more specifically: oil-based money, and a realistic ongoing-threat of its gradual disappearance.
OPEC countries compose one third of global oil production, which makes the organization a key player in everything that has to do with global oil prices. September’s meeting ended in a mutual decision to limit oil output to around 33 million bpd (barrels per day). According to reports, today’s meeting is meant to provide a direct continuation to the previous one, and determine which individual, per-country, limitations on production will help execute the overall limit determined in the last meeting.
Today’s episode in OPEC’s oil soap opera will hopefully include, if not a happy ending – a reasonably satisfactory compromise to all of the involved parties. According to reports published prior to today’s meeting, different offers were unofficially laid on the negotiation table as a preparation to the Vienna conference. Naturally, each country attempts to push in a direction that is more profitable for its economic goals. However, eventually these countries will probably have to compromise in case a common agreement should ever be reached.
Meantime, optimistic voices are being heard from both the Iranian Oil Minister, Bijan Zanganeh, and the UAE Energy Minister, Suhail bin Mohammed al-Mazroui. As often happens when predictions are positive – oil prices seem to be going up, and currently show a rise of value that stands at 4.5%. According to reports, a deal is hoped to be achieved today around afternoon. We can’t wait to see how this one turns out.
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