Posted on 01/28/2016 10:36:20 AM PST by Citizen Zed
Russia said on Thursday that OPEC's largest producer Saudi Arabia, had proposed oil production cuts of up to 5 percent in what would be the first global deal in over a decade to help clear a glut of crude and prop up sinking prices.
Benchmark Brent futures jumped as much as 8 percent on Thursday to nearly $36 a barrel on news of the potential deal, which if implemented would immediately reduce surplus global output exceeding demand by 1 million barrels per day (bpd). Brent was trading at $34 a barrel at 1540 GMT.
A turnaround in oil's fortunes would be welcomed by oil-rich countries where the price collapse has caused budget squeezes and political turmoil with some even forced to devalue their currencies.
Russian Energy Minister Alexander Novak said Saudi Arabia had proposed that oil-producing countries cut production by up to 5 percent, which for non-OPEC member Russia - the world's top producer - would represent around 500,000 bpd.
(Excerpt) Read more at mobile.reuters.com ...
The Royal Family need the money
Looks like the Saudis blinked. Or it could be bad info to try and jack prices up.
OK let’s all jump off the roof on 3...
I dont see any cut in production any time soon. Too many players that need too much money.
I just hope Barry doesn’t get any ideas about controllinv US production.
LOL. Freepers used to complain about Saudi cuts, now they want them.
But owing to the elasticity curve of oil, they might each get more money by pumping less, provided they all worked together.
And the stock market has taken off like a scalded cat.
Just so long as nobody else says anything until after 4....
Actually, Saudi Production was down a bit in December.
Volumes from kingpin producer Saudi Arabia dipped last month by 50,000 b/d to 10.1 million b/d.
http://www.youroilandgasnews.com/news_item.php?newsID=126480
More likely with Russians on the ground the royal family got scared. Would you trust Obama to defend you?
Complaining that the Cartel won’t act like a Cartel...
Saudi’s need about $80/barrel oil to make their budget work. They have considerable reserves but they’re burning through them very quickly.
With their considerable social welfare programs put in place over the recent past to keep the radicals and masses sedated and their war in Yemen there is tremendous pressure being put on their budget. This can be seen with their recent announcement of considering to take Aramco public. Probably the largest corporation in the world. They need cash.
Breaking Russia’s clampdown on the Sunni terror groups and their backing of Assad and Iran isn’t working out so well. Not to mention the benefit of breaking shale production in the US, which may work but will come back on line with different owners at some point.
They have way too many fixed costs for such an ambitious undertaking to work.
If oil production is cut and oil price rises maybe that will be helpful in keeping our fracking/oil shale exploitation alive. After all, killing fracking was the Saudi’s reason for pumping lots of oil while the price was falling. But the democraps don’t like fracking/low oil prices anyway.
The last to cut will be the US.
I’m just afraid that Barry may enter into some international production cut agreement.
They need about 66 a barrel, but they’re still a ways from it.
He might, but it has no legal power that I can see.
He might, but it has no legal power that I can see.
OPEC States Say No Meeting Planned as Russia Floats Talks
http://www.bloomberg.com/news/articles/2016-01-28/opec-delegates-say-no-plan-for-meeting-after-russia-floats-talks
January 28, 2016 — 11:29 PM CST
OPEC delegates said they have no meeting planned with Russia after the country’s Energy Minister Alexander Novak indicated he was willing to meet with the group next month to coordinate oil-output policy.
Four OPEC representatives said they hadn’t heard of any plan for talks. One Gulf member said de facto leader Saudi Arabia had no proposal to trim production by 5 percent, after Interfax reported the country had suggested such a cut at previous OPEC meetings, citing Novak. The minister said Russia would be willing to discuss output with OPEC, according to the news service.
“It’s possible that Russia could be testing the waters to gauge how OPEC members would respond to the idea of cuts,” said Jason Bordoff, director of the Center on Global Energy Policy at Columbia University and a former senior oil official at the White House.
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