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Crucial OPEC meet today
A divided OPEC will meet here on Wednesday to determine output as crude oil prices remain under the spotlight. Everyone tries to read OPEC’s mind to guess the potential outcome.
Qatar and Venezuela indicated that there was no need to change the output. However, Nigeria, Kuwait and Indonesia took a different tune, saying OPEC could agree to an output increase if required.
Saudi Arabia, OPEC’s most influential member has not opened its mind on this issue
Crude futures were in volatile trading for the last two days, reflecting the comments from the members. Crude oil prices had fallen almost US$10 since its historic peak of US$99.29 on Nov 21.
OPEC was concerned that additional output could result in oversupply, thus further dampening prices, but maintaining quotas could send prices back up to near US$100.
Even if OPEC decides to raise production, there’s no guarantee for stable price to sustain in world market.In September, the members agreed to increase 500,000 barrels per day but oil price still rallied to almost US$100 recently.
Since 2000, OPEC had opted to fine tune its supplies to align closely with oil demand but without allowing oil companies and refiners to build too many oil inventories. Such move helped the cartel boost prices after the oil collapse in the late 1990s.
A divided OPEC will meet here on Wednesday to determine output as crude oil prices remain under the spotlight. Everyone tries to read OPEC’s mind to guess the potential outcome.
Qatar and Venezuela indicated that there was no need to change the output. However, Nigeria, Kuwait and Indonesia took a different tune, saying OPEC could agree to an output increase if required.
Saudi Arabia, OPEC’s most influential member has not opened its mind on this issue
Crude futures were in volatile trading for the last two days, reflecting the comments from the members. Crude oil prices had fallen almost US$10 since its historic peak of US$99.29 on Nov 21.
OPEC was concerned that additional output could result in oversupply, thus further dampening prices, but maintaining quotas could send prices back up to near US$100.
Even if OPEC decides to raise production, there’s no guarantee for stable price to sustain in world market.In September, the members agreed to increase 500,000 barrels per day but oil price still rallied to almost US$100 recently.
Since 2000, OPEC had opted to fine tune its supplies to align closely with oil demand but without allowing oil companies and refiners to build too many oil inventories. Such move helped the cartel boost prices after the oil collapse in the late 1990s.