Oil experts: The decision to cut production is "positive" and supports reviving the budget

by **Rocky** Tue 04 Apr 2023, 5:29 am

Rocky: Admin Assist; Posts : 280906
Join date : 2012-12-21

Post n°1

Oil experts: The decision to cut production is "positive" and supports reviving the budget

by Rocky Tue 04 Apr 2023, 5:29 am

Oil experts: The decision to cut production is "positive" and supports reviving the budget

Economical 04/04/2023
[You must be registered and logged in to see this image.]

Baghdad: Ali Muwaffaq

In a "fragile" budget that relies on exporting crude oil as a main source of revenue, oil experts believe that the decision to reduce oil production within the sudden agreement announced by a group of exporting countries is positive in terms of benefiting from high prices and achieving balance in global markets.
This comes after the continuous decline that occurred in recent times, but they did not rule out at the same time its risks, as it would harm Western countries, led by the United States.
The Ministry of Oil attributed the reason for Iraq's accession to this decision, which will be implemented from next May until the end of 2023, to the fact that it comes as part of the precautionary measures to face the challenges facing the crude market and achieve balance and stability between supply and demand.
And 9 countries from (OPEC Plus) announced simultaneously and unexpectedly a reduction in oil production by about 1.65 million barrels, distributed by 500 thousand barrels per day from Russia and the same amount from Saudi Arabia, 211 thousand from Iraq, 144 thousand from the Emirates and 128 thousand from Kuwait, in addition to 48 thousand barrels. From Algeria, 78 thousand from Kazakhstan, 40 thousand from the Sultanate of Oman, and 8 thousand barrels from Gabon.
The economist and oil expert, Nabil Al-Marsoumi, said: The decision of (OPEC Plus) to reduce production by more than 1.6 million barrels per day comes for possible economic and political considerations, but it contributed to an increase in the price of Brent crude by about $ 5 from 79 to 84 dollars, and it is consistent with the behavior of producers who aim to maximize their profits. This is what really happened in the short term.
He explained that the decision to reduce production with the intention of raising prices will harm global economic growth, especially since Western countries are currently suffering from a crisis of stagflation, which may lead in the medium term to weak global demand for oil and lower prices, in addition to the risk of losing (OPEC Plus) its shares. market in the future and another related to the possibility of enacting the (NOPEC) law that allows US individuals and companies to sue oil producers who intervene to raise prices.
And Al-Marsoumi indicated that Iraq’s decision to reduce its production of crude oil from next May to the end of 2023 by 211 thousand barrels per day was surprising, with other cuts by Saudi Arabia, Kuwait, the Emirates, Oman and Algeria amounting to 1.071 million barrels per day, in addition to Russia’s reduction of its production by about 500 thousand barrels. daily to stabilize global oil prices.
He stressed that this measure might be fraught with danger, fearing a possible American reaction that might harm these countries, including Iraq.
The cuts came in the wake of a sharp decline in oil prices last month, after the collapse of the American “Silicon Valley” bank and the compulsory acquisition of “Credit Suisse” by “UBS”, which raised fears of a “bank collapse” infection spreading in global financial markets and a decline Great demand for crude oil.
For his part, oil expert Hamza Al-Jawahiri said: OPEC will not acquiesce to America's policy, which continued to pump large quantities of oil, ranging from one million to one and a half million barrels per day, to the markets from its strategic reserves in order to reduce prices and set them according to what it deems appropriate for it.
He stressed that America's price control affects OPEC's sovereignty, as the organization seeks to maintain market balance and price stability at $80 a barrel, which is fair to producers and consumers alike.
He added that OPEC has understood America not to manipulate and control the oil market alone, and that the organization is responsible for the economy of the member countries and will continue to monitor the markets.
He pointed out that the United States continues to pump oil from its strategic reserves, despite the significant decrease in its storage, as it reached its lowest level in 38 years, and it continues to do so in order to confront OPEC, which is more like a war.
Al-Jawahiri stressed that Iraq will not be affected by this reduction, because the increase in oil prices will cover the reduction and more.
And he added that the days have proven that the economies of the West cannot stand without cheap oil prices at less than 60 dollars, stressing that the West's endeavor to reduce oil prices is not a condition, but rather a goal for these countries, and this matter is the beginning of this strong attack on oil prices and (OPEC). Despite the reassurances of (OPEC) and the recovery of the Chinese economy, the issue is related to the West's economy in general, which cannot resist prices above $60.
In a first reaction to the decision, a spokesman for the White House National Security Council said in a statement that the recently announced cuts by OPEC countries were "illogical", given the uncertainty in the market.
Oil prices jumped yesterday, Monday, at the beginning of weekly trading, by more than 6 percent, hours after members of the “OPEC Plus” alliance announced a voluntary cut in production, as Brent crude futures for June delivery rose to $ 84.96.
per barrel.
[You must be registered and logged in to see this link.]

Established in 2006 as a Community of Reality

Established in 2006 as a Community of Reality

Established in 2006 as a Community of Reality

Oil experts: The decision to cut production is "positive" and supports reviving the budget

Oil experts: The decision to cut production is "positive" and supports reviving the budget

Oil experts: The decision to cut production is "positive" and supports reviving the budget

Similar topics

Similar topics

Latest topics

World Headline News

Board Rules Click Below

Most active topic starters

Top posters

Top posting users this week

Top posting users this month

Disclaimer

Keywords

Search Query

Display results as : Posts Topics
Tags
Advanced Search