Brent Spread Diverges: How Does This Impact US Oil Producers?

The Organisation of the Petroleum Exporting Countries, which decided late previous year to focus on maintaining market share instead of propping up oil prices, holds its next policy-setting meeting at its Vienna headquarters on December 4.

By 2040, OPEC could account for nearly half of global oil production, or 49.2 million barrels a day.

New York-traded oil futures lost $2.14, or 4.94%, last week after data showed that oil supplies in the US rose for the sixth consecutive week, remaining near levels not seen for this time of year in at least the last 80 years.

Non-OPEC producers must share the burden of any supply cuts as OPEC won’t accept less than 40 percent of global output, he said.

Saudi Arabia is intent on drowning its competition in a sea of cheap oil.

The Southeast Asian nation suspended its membership in January 2009 after becoming a net oil importer. From 2009 to 2014, an additional 5 million or so barrels of oil a day were produced.

Indonesia will become a net importer of crude by 2020 as the country plans to add new refinery capacity, according to a BMI Research report in October.

In a release, S&P said a “pronounced negative swing” in Saudi Arabia’s fiscal balance prompted the downgrade.

Mr Al Badri blamed non-Opec producers for the oversupply and criticised them for not heeding Opec calls for coordinating production in order to help boost prices. Investment will be cut by 20 per cent this year and will drop further in 2016, the first two-year decline in spending since the 1980s, IEA executive director Fatih Birol told reporters at a briefing in London.

The discord in views comes as most global majors are slashing their budgets and investments with the aim to be able to generate cashflows with prices as low as $60 per barrel.

A few of the OPEC members like Algeria, Venezuela and Iran are facing the pinch more than the others as oil prices continue its downward run.

Any decrease in oil production will likely not happen overnight.

Officials who are in Riyadh said that in a couple years the demand will once again go up, which would end the global oil glut, and then the prices will begin to go back up again.

“As a responsible and reliable producer with a long-term horizon, the kingdom is committed to continue to invest in its oil and gas sector, despite the drop in the oil price”.

Data showing crude imports from China, the world’s second-biggest oil consumer, fell to the lowest level in five months is also keeping a lid on prices in the face of a world supply glut.