Oil prices have reached a 6 year high following the end of discussion between OPEC and other nations known for oil production. They reached a conclusion that there will not be an increase of 400,000 barrels per day. Failure to reach an agreement is based off of a split in OPEC between the United Arab Emirates and Saudi Arabia.
Tag: Saudi Arabia
Saudi’s Want to Increase Oil Production?
After 2020’s unpredicted decline in oil prices and subsequent response by OPEC+ to cut oil production as means to buoy oil prices, the world’s largest exporter Saudi Arabia, plans to reverse its position and increase its production in the coming months. This comes as WTI oil prices have traded to as low as negative $40/barrel back in April 2020, to currently trading at $60.42/barrel. Earlier this month OPEC+ leaders said they would cut production by one million barrels per day, with efforts to raise prices during the months of February and March.
2021 Oil Rally; Biden confirmed as the 46th POTUS
We are a mere 7 days into a new year, and have already seen the first oil rally in the markets. Many factors have played a role in the first rally of the new year. Oil has been tumultuous over the last 11 months but has seen some stability and positivity since Biden’s election win in November. Biden was confirmed by the senate to be the 46th President of the United States of America and he will have a democratic controlled House and Senate to put his plans into action.
Production Cuts Start Early for These Two
OPEC+ came to an agreement earlier this month to institute record-breaking production cuts of nearly 10 million barrels per day. The production cuts were set to take effect on May 1st, but some members have taken it upon themselves to start earlier. Kuwait and Saudi Arabia have both made the decision to start scaling back production to work towards the production cut goal. Saudi Arabia has scaled back production from 12 million barrels per day(bpd) over the weekend to reach its goal of 8.5 million bpd. Kuwait is OPEC’s fourth largest producer and they have also made the decision to start the cuts early. Kuwait’s Oil Minister Khaled Al-Fadhel said that starting the cuts early was because they felt a responsibility to address the market conditions.
A New Number One
Saudi Aramco had its long-awaited initial public offering (IPO) last week debuting on the Tadawul, Saudi Stock Exchange at a valuation of $1.88 trillion. Aramco’s public debut made it the world’s largest IPO ever, toppling the previous record holder Alibaba in 2014 when they raised $25 billion. When the market closed today in the capital city of Riyadh, Aramco had a market value of over $2 trillion.
Trade War Takes a Back Seat to Oil Fundamentals
The Cost to Consumers
The events over the weekend in Saudi Arabia are causing concerns throughout the nation. The oil installations attacked resulted in the removal of six percent of daily world consumption, which will have an impact on motorists and consumers in the United States as early as today. The attack on Saudi Aramco’s Abqaiq plant in Buqyaq and the Khurais oil field is the biggest disruption to Saudi Arabia’s oil industry since the early 1990’s. The pain consumers may feel center around how long it takes normal output from the world’s second-largest oil producer to return.
Saudis Spark Afternoon Rally
The oil patch rallied today after starting off the day in the red as news hit this afternoon that Saudi Arabia will be targeting the United States with sharp oil export cuts in January.
WHO RUNS THE WORLD? OPEC
The world of crude oil is buzzing right now, as OPEC is currently meeting in Vienna, with a goal of reaching an agreement over production levels within the next 6 months. Oil prices dropped over 3 percent on Thursday as OPEC agreed to cut production. However, the cartel is waiting to decide on the actual size of reduction until after a discussion with Russia. This could delay the decision until Friday, when OPEC is set to meet with non-members.
The Latest News from the Middle East
The geopolitical climate in the Middle East continues to intensify as the Saudi government is preparing to admit that Washington Post columnist Jamal Khashoggi was killed in the Saudi consulate in Turkey two weeks ago. President Trump has threatened to impose severe punishment on Saudi Arabia if it is proved they are behind the murder while the Saudi government has said they will respond with greater action if the United States moves forward. The threat of Saudi Arabia using their oil reserves as a weapon has the world on the edge of their seat.
