Related: Iraq is flooding America with lots of oil In other words, the status quo looks intact. On Monday, Saudi Arabia's official news agency reported that the country is ready to "cooperate with all oil producing and exporting countries."īut the comments didn't give any details or signal a new willingness to cut output and the kingdom has made similar remarks in the past.Ī Saudi ministerial source told CNN's John Defterios the Saudis will not budge if Russia continues to produce nearly 11 million barrels per day, Mexico is not part of the non-OPEC equation and if Iraq refuses to live by an OPEC quota. The 60% plunge in oil prices since June 2014 has slashed OPEC revenue by nearly $500 billion a year, according to the International Energy Agency. Related: $2 gas coming soon for most Americans "Of course, that's a risk," said Philipp Chladek, a Bloomberg Intelligence analyst who covers the oil and gas industry in Europe, the Middle East and Africa. The deep dissension threatens to destroy OPEC, at least as we know it.
Few expect Saudi Arabia to cave to the demands of others, but get ready for more verbal fireworks. Related: Epic oil glut sparks super tanker 'traffic jams' at seaĪll the bellicosity from OPEC members is coming as the group is preparing for what should be an awkward gathering in Vienna on December 4 to decide on output. "It does not help them and it does not help anyone," he said. Nigeria's former central bank governor Muhammad Sanusi II recently told CNN that Saudi Arabia's decision to flood world markets with oil is a mistake.
Algeria has called for a price floor, while Ecuador's oil minister said the only way to balance the market is to cut production. Venezuela's oil minister warned that oil could plunge to $25 if OPEC doesn't act fast. "OPEC has never been more divided," said Fadel Gheit, an Oppenheimer analyst who has been closely covering the oil industry for 35 years. They are all but begging the Saudis to shift strategy - but so far their calls have gone unanswered. The collapse in oil prices is especially hurting less affluent OPEC members like Algeria, Angola, Ecuador, Nigeria and Venezuela. Weaker OPEC members face off with Saudi Arabia Related: Saudi Arabia to run out of cash in less than five years
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