Saudi Arabia’s oil minister said it’s “inevitable” that OPEC and its allies will agree to boost oil output gradually, giving the most definitive signal yet that the cartel will alleviate high prices for consumers.
“I think we’ll come to an agreement that satisfies most importantly the market,” Khalid Al-Falih told reporters in Moscow yesterday, when asked about the outcome of the meeting between the Organization of Petroleum Exporting Countries and its allies in Vienna next week. “I think it will be a reasonable and moderate agreement” but nothing “outlandish,” he said.
Russia and Saudi Arabia, leaders of the deal that curbed crude output and boosted prices to three-year highs are discussing their next move in Moscow. They face growing pressure, not least from the Twitter account of U.S. President Donald Trump, to increase supply to offset disruptions caused by the economic crisis in Venezuela and renewed American sanctions on Iran.
For Al-Falih, the assertion of inevitability is a gamble on his ability to persuade those two nations to drop their opposition to an output increase in face-to-face meetings in the Austrian capital next week. So far, Caracas and Tehran have been adamant that OPEC doesn’t need to boost production this year and have warned against responding to political pressure from Washington. Bloomberg
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