The OPEC’s June meeting will not give significant results if Saudi Arabia does not change its position on the oil market glut, Dmitry Marunich, co-chairman of Ukrainian Energy Strategies Fund, told Trend May 24.
Saudi Arabia stated in different periods that it will not reduce the oil production till Iran does not do the same. As a result, oil prices have been varying in the range of $40-50 per barrel for a long time. Iran wants to increase the daily oil production up to four million barrels, that is, the pre-sanction oil production level.
Marunich said that the recent resignation of Al-Naimi, Saudi Arabia’s oil minister, at first glance, inspired major oil players with some reasons for optimism.
Marunich added that however, Khalid al-Falih, Saudi Arabia’s former health minister, replaced Al-Naimi and continued the policy of filling the market with oil.
According to the IEA, the current oil production hits 10.2 million barrels per day in Saudi Arabia.
“OPEC has actually lost effective levers of influence on oil prices which the organization had in 1980-1990s,” the expert said. “OPEC has been divided into two camps, having different views of the situation on the market, and they do not even try to reach a compromise.”
The oil-producing countries could not agree on freezing of oil production at the previous meeting in Doha on April 17 to stabilize the market. The OPEC’s next meeting is scheduled for June 2.