Tensions are emerging within the Organization of the Petroleum Exporting Countries over which member countries should trim oil production to make room for a resurgence in Iraqi exports and the possible return of more Iranian crude to world markets if sanctions are eased.
Tensions are emerging within the Organization of the Petroleum Exporting
Countries over which member countries should trim oil production to make room
for a resurgence in Iraqi exports and the possible return of more Iranian crude
to world markets if sanctions are eased.
There is no expectation of a decision to cut back at the OPEC cartel's meeting
in
Vienna
on
Wednesday. The group of 12 of the world's largest producers, though long riven
by squabbling, has kept its overall production ceiling at 30 million barrels a
day since December 2011.
OPEC expects overall demand for its crude to drop by about 300,000 barrels a
day next year and some members are pushing to trim output, according to people
familiar with the debate.
Members will have to decide whether to cut production as early as the first
half of the year, with the risk that short-term global supply might build to a
level where prices fall, an OPEC official said.
OPEC holds outsize sway in global oil markets, producing more than one out of
every three barrels burned in the world. But its ability to move prices
significantly has been hindered recently by a surge in non-OPEC crude,
including a boom in
U.S.
production of shale oil.
Iraq
is
also making strides in dramatically boosting its output after it was hobbled by
Saddam Hussein-era sanctions and then the fallout of the U.S.-led invasion of
the country. The country is on track to produce some three million barrels a
day on average this year, its highest sustained level in at least 20 years.
Iran
's
interim nuclear deal with the West a week ago has added new uncertainty over
whether that country will eventually be allowed to ramp up its own output to
global markets.
Iran
agreed to curtail activities that the West suspects are aimed at making nuclear
weapons in exchange for some limited relief from international sanctions that
have cut its critical oil exports by some 1.5 million barrels a day to 715,000
barrels a day now.
The deal doesn't allow for new Iranian oil exports, but promises to temporarily
halt new restrictions on those exports over the next six months.
Iran
is
currently producing a bit below its sanctions limit.
But because the deal allows previously banned insurance on Iranian oil
shipments, it could result in the addition of a few hundred thousand barrels of
Iranian oil a day to markets.
The prospect of
Iraq
and
Iran
boosting their output in the coming year is putting additional pressure on OPEC
members to shave overall production to bolster prices.
Iran
is
pushing publicly for
Iraq
to
throttle back, accusing
Baghdad
of
stealing its customers while it was under sanctions. "
Iraq
has
behaved inappropriately in dealing with customers of Iranian oil," Mansour
Moazami, an Iranian deputy oil minister, said in an interview with the
ministry's website.
Some expect
Iran
to
seek a debate on whether certain cartel members should rein in production if
Iranian barrels start to return to world markets.
"If
Iran
increases its production, OPEC may have to look at who should cut, and most
likely that would be the Gulf," an OPEC official said.
Gulf OPEC officials, however, are split on who should rein in output, according
to people familiar with the debate.
Saudi
Arabia
,
Kuwait
and
the
United Arab Emirates
, who
together account for more than half of the cartel's output, are possible
candidates.
Some say they should do it themselves next year in an effort to support prices,
while others say Iraq should be asked to rein in its output, those involved in
the debate say.
"The closer
Iraq
gets
to a four million barrels [a day] mark, the more it is important for us to find
a way to put a limit on their output," said one Gulf delegate.
Iraq
has
shown little willingness to back down. "I don't think we can take orders
from anybody [related to] the future of Iraq -- especially Saudi Arabia and
Iran," Adnan Al Janabi, chairman of the Iraqi parliament's oil and gas
committee, said at an energy conference in Istanbul in November.
Earlier this year, surging production by the
U.S.
divided cartel members over what to do in response to all the new supply from
outside OPEC's ranks.
They agreed only to study the issue at the group's last meeting in May.
The
U.S.
is on
track to overtake
Saudi Arabia
as
the world's biggest oil producer by 2015, according to the International Energy
Agency.
The prospect of this growing
U.S.
supply is another reason the return of Iranian oil or an increase in Iraqi
output could prove so contentious.
Διαβάστε ακόμα
Παρ, 26 Ιουλίου 2024 - 16:04
Παρ, 26 Ιουλίου 2024 - 16:02
Τετ, 24 Ιουλίου 2024 - 15:10
Τετ, 24 Ιουλίου 2024 - 15:06
Τρι, 23 Ιουλίου 2024 - 16:51