Oil, the Iran-Saudi confrontation hinders agreement on prices – The Republic

MILAN – The main oil producers are trying a last-minute agreement. In Doha, capital of Qatar, met 15 of the 16 countries joining OPEC. Missing, understandably with the domestic situation, only Libya. According to some observers, it sarabbe found general agreement to “freeze” the production of crude oil to last January’s levels at least until next October, but it would be still overcome some contrasts between Saudi Arabia and Iran. which is why the final signature of the text has been postponed to late evening.

In fact, Iran is trying to obtain exemption from the freezing because, after the end of the embargo, he needs to bring back to the period of oil production previous sanctions to boost the economy. The initial situation is given by oversupply shown in 1-2 million barrels per day globally, with Russia and Saudi Arabia, are producing at record levels with the intent to difficulties American operators of shale oil. Saudi would be willing to reduce quotas on condition that they do it all in an equivalent manner.

But – as I said – there is the problem of Iran. Saudi refuses to meet in Tehran (which is also divided on political and religious grounds), as well as in recent months has rejected a direct agreement with Russia: the Moscow government is increasingly difficult for the loss of revenue from sale of raw material, although it has announced that it will not stop the increase in production before 2017

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for its part, despite not having sent the relevant minister, Tehran supports its intention to freeze production but reiterated that will not participate in the agreement. The oil minister, Bijan Zaganeh, reiterated that Iran will not freeze the production until the country will not be returned to previous levels of production in the 2011 international sanctions.

To trigger the race to the bottom it has been especially decision Arabia to increase production to put out of action the American producers of shale oil, which have a breakeven around 70-80 dollars per barrel. But the markdowns stranno cripple the ecnomie of the entire Middle East region. In Kuwait, thousands of oil workers began a strike Saturday indefinitely to protest against a wage cut, causing an immediate drop in production of crude oil emirate. A spokesman for the Kuwait Oil Company announced that production fell to 1.1 million barrels. On average, Kuwait, OPEC’s fourth largest producer, produces three million barrels a day.

The uncertainties of the summit also weighed on the financial markets. On Friday the New York Stock Exchange had closed down with oil, with the price of oil down 3 percent, burning part of the gains accumulated during the propio week ahead of the Doha summit. Any text will be signed, they will be very important words that will be used to not having new repercussions on prices at the reopening of the price lists. A general test has taken place yesterday at the Stock Exchange Ryad: the Tadawull index ended trade on minimum day with a 1.48% decline. Also weighing on trade, just slip a few hours of the meeting to freeze the production.

Topics:

Oil

crude

OPEC

Doha

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