OPEC likely won’t move to boost oil price amid infighting

It is said that the Kingdom would seek arrangements with non-OPEC members to help support prices.

Although the subsequent collapse in crude oil prices led to diminished rig counts and thousands of lost energy sector jobs in the USA, the domestic fracking industry proved to be far more resilient than most anticipated.

West Texas Intermediate for January delivery gained as much as 71 cents, or 1.8 percent, to $40.65 a barrel on the New York Mercantile Exchange.

But Saudi Arabia apparently has no interest in helping other OPEC countries, especially Iran.

The Saudis have continued to flood the market with cheap oil as they seek to push out new producers who lowered production costs.

Meanwhile, Eurostat, the statistical office for the European Union, reported euro area inflation at 0.1 percent for November, stable when compared with the previous month.

OPEC is thought to be producing about 1.7 million barrels per day above its official output ceiling of 30 million barrels per day.

“We have no responsibility for the situation that is in the market”, Zanganeh said.

Iran’s envoy to OPEC, Mehdi Asali said on Wednesday that an OPEC majority wants to reduce crude oil production from the current more than 31 million barrels a day to spark a price recovery.

Russian Energy Minister Alexander Novak has that a production cut is not viable for the country and it’s not planning on taking part in the OPEC meeting.

All eyes are on an OPEC ministerial meeting on Friday, but the group is widely expected to maintain its strategy of keeping output high in an attempt to defend market share. Crude oil stockpiles alone rose for the 10th week in a row, according to the EIA, bucking Wall Street expectations for a decline.

Crude fell below $40 a barrel (brace) on Wednesday for the first time since August after the USA reported another increase in its oil stockpiles.

“OPEC’s poorer members like Algeria, Nigeria, Venezuela, they’ve been making these increasingly desperate calls for production cuts to try to get the price back up”, he says.

Saudi Arabia offered Thursday to cut output if other OPEC and non-OPEC countries do, but a deal is unlikely to come in time for the cartel’s meeting on Friday. “If you’re Saudi Arabia, lower oil prices are the single strongest tool you have in economic war”.

The proposal, if confirmed, would suggest Saudi Arabia is looking to fine tune the approach it took a year ago when it abandoned a policy of managing the market with large output cuts in favor of pumping more and letting the market balance itself.

In the past year, OPEC members have largely pumped crude with few production restrictions.

Granted, it’s true that OPEC is more than likely looking for better access to Asian markets, and Indonesia is a flawless way to bridge the gap.