Two of OPEC’s biggest members say they won’t immediately reduce oil production to offset tumbling prices, a signal the group is unlikely to heed Venezuelan calls for an emergency meeting.
While producing nations would like higher prices, there’s “no room” for them to achieve that by lowering supply, Kuwait’s oil minister told the official Kuwait News Agency yesterday. Saudi Arabia, which pumped almost one-third of the group’s output last month, won’t alter its supplies much between now and the end of the year, a person familiar with its policy said Oct. 3.
[quote_box_left]“Saudi action is what matters most and we have yet to see anything,” Katherine Spector, a commodities strategist at CIBC World Markets Inc. in New York, said yesterday by phone. “There’s not a lot the Venezuelans can do, either by action or rhetoric, that will change things.”[/quote_box_left]
OPEC’s largest Persian Gulf producers, including Saudi Arabia, Iraq and Iran, are offering the biggest discounts to buyers in Asia since at least 2009 to maintain market share amid a global glut that has sent oil into a bear market. Venezuelan President Nicolas Maduro gave instructions to ask for an extraordinary meeting, the country’s foreign ministry said in a post on its Twitter account on Oct. 10.
Ample supply, helped by surging U.S. and Russian output, pushed Brent crude, the benchmark for more than half the world’s oil, down more than 20 percent from its peak for the year on June 19, meeting a common definition of a bear market. Brent slipped as much as 2.1 percent to $87.03 a barrel today, the lowest intraday price since Dec. 1, 2010.