Saudi Struggles For Gulf Oil Producers' Support Ahead Of OPEC Meeting

High oil prices hurting fiscal balance, says Pradhan

Iran has rejected a plan by Russian Federation and Saudi Arabia to increase oil production at a meeting of the OPEC oil cartel this week in response to consumer disgruntlement with rising prices.

Last year, OPEC members unanimously agreed on the oil price of USD 60 dollars per barrel, by cutting oil output by 1.2 million barrels per day (bpd) to 32.5 million bpd.

Markets are also anxiously watching trade tension between the USA and China, in which both sides have threatened to impose stiff duties on each other's exports, including United States crude oil.

The energy ministers of Saudi Arabia and Iran also held last-minute talks ahead of the Opec meeting on Friday, the Financial Times cited Iran's Shana news agency as reporting.

The world faces likely lower oil exports from Iran, Opec's third-biggest producer, after US President Donald Trump pulled out of a 2015 nuclear accord with a vow to renew sanctions against Tehran.

The real increase will be smaller because several countries that recently underproduced oil will struggle to return to full quotas while other producers will not be allowed to fill the gap, OPEC sources have said.

"OPEC needs to come out with something - that they are going to phase in supply as they see supply from Iran, Venezuela and Libya come off the market", Sheffield told reporters.

The president of the United States doesn't have any problem with increased oil prices since this leads to raising Shale productions, said the minister, adding, "however in public, he shows opposition and blames the OPEC while these conditions are not created by OPEC but by the USA administration". Iran is usually not part of the committee, which includes Russia, Saudi Arabia, the UAE, Oman, Kuwait, Algeria and Venezuela.




The members' vastly different relationships with the US government are also running through the meeting like a fault line.

He said he thinks $70 per barrel would be a "very good" oil price.

Brent reached a 3-1/2-year high above $80 a barrel last month but has fallen steadily in recent weeks as Saudi Arabia, de facto leader of OPEC, has signalled it intends to raise production to stabilise prices.

The intensive negotiations between ministers in Vienna this week are the culmination of a process that has whipsawed oil markets for weeks.

But analysts said trade concerns and disagreements within the Organization of the Petroleum Exporting Countries (OPEC) over boosting supply continue to loom over the market. That may seem insignificant in a global supply of 98 million barrels a day, but critically it would reverse reductions that the same countries approved in late 2016, helping push crude higher by more than 50 percent. He also said the US oil output boom would slow due to pipeline shortages in the next two years.

Washington and Beijing have both threatened punitive tariffs on each other's exports, including US crude oil.

Officials from major oil-producing nations are expected to agree this week to boost output, but just how much they will open the spigot - and the effect on oil prices - remain wild cards.

Analysts have called this week's OPEC talks the most fractious and politically charged in years.

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