Saudi Arabia, Russia work to prevent oil prices dip: minister

Daniel Fowler
June 13, 2019

Despite this, MacPherson said "there is a limit to how much longer it (OPEC+) can continue to avoid addressing the serious challenge of being squeezed out by growing United States production".

There is a risk that oil prices could drop to as low as $30 a barrel because OPEC and its Russia-led allies could produce more oil by the end of the year than market demand, Russia's Energy Minister Alexander Novak said on Monday in comments suggesting that Russian Federation could be on board with extending the cuts.

US sanctions on Iran and Venezuela are likely to tighten the market, many analysts forecast, while US-China trade tensions could dampen global oil demand.

Equity markets across Asia and Europe rose broadly today despite U.S. President Donald Trump threatening to slap huge new tariffs on China if his counterpart Xi Jinping doesn't attend the upcoming G20 meeting.

"With the Mexican stalemate averted and no harmful shockwaves from this weekend G-20 meeting. oil could trade favorably as WTI and Brent will continue to track the broader risk environment high", Innes said. Saudi Arabia is now hurrying to extend the ongoing production cuts, which are due to expire in June. "The remaining country to jump on board now is Russian Federation. I will wait for the Russian dynamics to work themselves out", Falih told TASS in an interview.

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OPEC is now scheduled to meet in Vienna on June 25 to decide output policy for the rest of the year.

The two ministers yesterday discussed postponing the next OPEC meeting to 4 July, instead of 25 June, according to Novak.

The charter has been delayed over disagreements on how structured or loose to make the OPEC/non-OPEC coalition."The current status of the global oil markets, which are volatile once again, makes the Saudi-Russian cooperation all the more important", Falih said in a speech at the Moscow summit.

Traders said crude prices were rising because of statements by OPEC's de-facto leader Saudi Arabia on Friday saying that the group was close to agreeing on extended supply cuts.

"Now all the talk among OPEC is a rollover", a second source said, adding that "there is no official proposal, just discussions" of the idea for a larger cut. "That is why we look carefully forward to the possibility of creating a permanent charter of action for future collaboration in global markets between the big oil producers".

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