Saudi Arabia announced a reduction in production by an additional million barrels a day. The cuts will start in July. This marks the country’s lowest production level in several years, reports Bloomberg.
Sadowie was the only one in the OPEC+ cartel to decide on an additional reduction. They sacrificed their market share to drive up prices on world markets. After this decision, the price of crude oil increased by almost 5%. Ultimately, the prices, after a jump to nearly $ 79. per barrel, were located in the area of $77 on Monday morning.
The Saudis want to raise the price after drastic declines of more than 25%. compared to last year’s peaks, driven by fears of a recession and higher-than-expected availability of the raw material.
Saudi Energy Minister Prince Abdulaziz bin Salman said he would “do whatever is necessary to restore stability to this market.”
Disunity in OPEC+
Talks at the OPEC+ summit were not easy. The Saudis were left alone in a cartel consisting of 23 countries. The other members did not propose any additional action. They only committed to maintaining existing production levels until the end of 2024.
The cartel is internally divided, and more countries break out of the arrangements. Russia has already broken the production quotaswhich met with the reaction of Saudi Arabia.
Russia disloyal to the cartel
The Kremlin is doing what it can to keep oil revenues steady. So it floods Asia with cheap raw material. Therefore also The Saudis were forced to introduce discounts.
At the OPEC+ summit on Sunday, Moscow again pledged no further production cuts, and the United Arab Emirates secured a higher production quota for next year.
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2023-06-05 04:41:59
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