OPEC should change course, cut oil output: Libya official
http://english.alarabiya.net/en/business/energy/2015/04/08/OPEC-should-change-course-cut-oil-output-Libya-official.html
OPEC should change course and cut oil supply by 800,000 barrels per day (bpd) or more to prevent an expected return of Iranian exports from weighing on prices, Libya’s OPEC governor said.
The comments underline how the halving of oil prices from $115 a barrel in June on global oversupply is hurting OPEC’s less wealthy members outside the Gulf and suggests the 12-nation group remains divided over the impact of its 2014 policy shift to defend market share, not prices.
“OPEC members, as a unit, need to re-evaluate their strategies,” Samir Kamal, Libya’s OPEC governor and head of planning at the North African country’s oil ministry, told Reuters by email.
They “need to reach an agreement to bring down the production levels by at least 800,000 barrels a day, especially now that an agreement has been reached with Iran which is expected to increase its production,” he said.
more at link
As long as 800K bbl OPEC cuts = 800K bbl Saudi cuts, the Saudis may balk. At the same time, it does not seem economically rational for the Saudis not to cut. Cost-wise, they have the cheap oil. Profits at $80 with an 800K Saudi production cut will exceed profits at $50 without a cut. Why not enjoy the high prices merely by pumping less? This is presumably why Harold Hamm has doubled down. It’s not economically rational for the Saudis to pursue their current course of action.
Great story in the last few days about Saudi Arabia having to go in to the borrowing market this year as their revenue’s have fallen so.
ahhhh, to bad.
Add low oil prices to sanctions and we could ruin Iran’s leadership. Obama knows it. That’s why he’s trying to rescue them.
Already Obama Big Britches commentary from Tehran I see.............
“It seems (OPEC’s strategy of not cutting output) does not work well, because prices are coming down,”
Well, that is the purpose of the (Saudi) strategy, nitwit.
Iran tells OPEC they need to cut production to raise price.
Iran also states that they plan to put more oil on the market.
We’ll see how that works out.
Doesn’t work? That depends on what the goal is. Maximizing strategic profit in the ME might just be the goal rather than financial profit.
Saudi Arabia is much more concerned with Iran and ISIS than short-term oil profits.