Vienna (AFP)
Renew the reduction of oil supply or increase the effort? The Organization of the Petroleum Exporting Countries (OPEC) left markets in doubt Thursday, postponing the day after the announcement of a likely decision to support crude oil prices.
After a marathon meeting of more than six hours in Vienna, the 14 members of OPEC decided to resume their talks Friday, suggesting divides between members of the organization on the extent and distribution of production cuts to grant.
Pressed questions by reporters after the meeting, the Saudi and Venezuelan oil ministers were however confident that an agreement can be found "tomorrow" on Friday at the resumption of talks.
Torn between sluggish global growth, abundant oil stocks and still fragile prices, OPEC and its partners made the choice a year ago to curb their production, cut by 1.2 million barrels a day (mbj) compared to October 2018. This agreement expires in March 2020.
While a mere extension of the agreement seemed the initially preferred option, Russian Energy Minister Alexander Novak said Thursday that a larger production cut was envisaged.
"It was recommended to consider ... an additional production reduction of around 500,000 barrels in the first quarter of 2020," he said in Vienna. This quota would be re-evaluated at an "extraordinary meeting" in March.
This more radical option has not made the markets react, which sees it as a form of trompe-l'oeil since it "would only reduce the gap between the objective and the current level of production", already lower than that fixed. by the quota, commented Edward Moya, an analyst at Oanda, with AFP.
Friday's meeting should be with Russia and the other producing countries that joined forces with OPEC three years ago to face the US shale gas supply boom.
Rarely have the OPEC ministers remained so mysterious about their intentions.
For his first Viennese appointment as Minister of Energy, the Saudi Abdel Aziz ben Salman, half-brother of the powerful Crown Prince Mohammed bin Salman, had given no indication of his preferences.
- Exceeding quotas -
Saudi Arabia, the third largest crude oil producer and the world's largest exporter, is the leader of OPEC, without which no decision is endorsed.
The country bears most of the decline in production and is annoyed by the non-compliance with the agreement by several producers, such as Iraq and Nigeria, who pump above their quota. Russia, the world's second largest producer, also regularly exceeds the ceiling.
If OPEC and its allies agree to tighten the floodgates, it is still necessary to "clarify the details and see how it will be distributed," explained David Fyfe, an analyst at Argus Media.
It must be seen "to what extent would this represent real reductions and / or an improvement in compliance" with the already prescribed limitations.
Saudi Arabia has all the more interest in supporting the courses as the country opens a portion of the capital of its national company Aramco.
The oil giant, which produces about 10% of the world's crude oil, announced Thursday it managed to raise $ 25.6 billion for what will become the largest IPO in history.
The global economic context leaves little room for the cartel: the trade war weighs on Chinese growth, very greedy oil, while that of Europe, another area of strong demand, remains weak.
Production levels in non-OPEC countries are breaking records: the United States, the world's largest producer since 2018, extracts large quantities of shale oil, Brazil and Canada have also increased their production and other , like Norway, plan to do it.
Prices have been relatively stable since the previous meeting in July, around $ 60 a barrel for Brent - the European benchmark - except for a spike in September following attacks on Saudi oil facilities.
Unusual faces among the parade of oil ministers, climate activists were received Thursday morning by the secretary general of OPEC Mohammed Barkindo, after a silent protest in front of the headquarters of the organization.
© 2019 AFP