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Bloomberg’s Annemarie Hordern reports on OPEC’s upcoming meeting

Bloomberg’s Annemarie Hordern reports on OPEC’s upcoming meeting

The 14 countries in the Organization of the Petroleum Exporting Countries make more money with higher prices, but are mindful of the fact that more expensive crude can encourage a shift to renewable resources and hurt demand.

The so-called OPEC+ group agreed a milestone deal to trim production from January 2017 by 1.8 million barrels a day to clear a global oil glut and shore up low prices.

Both countries would struggle to increase output significantly, as Iran is facing renewed USA sanctions that will impact its oil industry and Iraq still has production constraints.

The worst case for tanker owners would be for OPEC members to keep production curbs in place, Poten said, because this would not generate any additional shipping demand and, combined with increasing geopolitical tensions, could push oil prices up to new levels which could affect global demand.

"Russia has been aggressively affirming itself by adding oil to market ahead of the upcoming meeting and is pushing for a significant output hike, Saudi Arabia is suggesting for a modest increase and others are in favour of the status quo", said Stephen Innes, head of Asia-Pacific trade at OANDA. There is a faction of smaller countries who want to continue with the production cut as they benefit from the rise in oil prices at a time when they are pumping oil at nearly full capacity.

Mexico beats defending champion Germany 1-0 at World Cup
In the first game of the day, Serbia beat Costa Rica 1-0 thanks to a brilliant Aleksandar Kolarov free-kick in Samara. Coach Juan Carlos Osorio, who called it a "milestone" win, said his team executed his game plan to near perfection.

"There was a time when oil producing countries were playing a lead role".

Since OPEC operates on the principle of unanimity, analysts expect some sort of compromise agreement to be thrashed out by Saturday. The compromise output boost, if agreed, would be smaller than the 1.5 million barrel a day quota rise that Russian Federation has proposed.

Back in late 2016, OPEC famously announced production cuts in a desperate measure to reduce the volume of oversupply in the market, the major catalyst behind oil falling from above $110 to below $30 between mid-2014 and early 2016. "The whole world has to stand against these arrogant attitudes - and will".

Iran had been expected to oppose any rise in crude output, but it has now signaled it may support a small increase. Those surveyed by S&P Global Platts see USA crude stocks having fallen 3.7 million barrels last week amid still-strong refinery runs. China said it would impose tarrifs on a variety of United States goods, including crude and gasoline, in response to President Donald Trump's $50 billion levy on Chinese imports.

Chinese tariffs on United States energy exports would affect roughly one of every four barrels of oil the USA now ships to overseas refiners and, if ultimately imposed, would spark a significant shift in global crude flows, analysts said Monday. "This recalls the June 2011 meeting, when OPEC was unable to agree on an increase in production to compensate for the outages.in Libya", Fritsch said. Russia, by far the largest non-member to join OPEC's cuts agreement, has said it would be happy with lower crude prices and appears keen to start up new fields. We expect prices to be in broad range of $63 and $66 on the WTI, with heightened volatility ahead of the event.

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