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Will OPEC cut production?

Wednesday, June 01, 2016 - 01:40

With oil ministers gathering in Vienna for Thursday's OPEC meeting, the focus falls on Saudi's new Energy Minister Khalid al-Falih. As Hayley Platt reports, he's thought to be better-disposed towards OPEC than his predecessor, though that might not translate into the output cuts some producers want.

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He's Saudi's new Energy Minister. And OPEC watchers will be looking for clues of his next move. Many want Khalid al-Falih to cut production and end the over supply of oil into the market. He's already in Vienna - arriving three days before the meeting of OPEC members on Thursday. Some say the fact that Russia - a non-OPEC member - isn't even bothering to turn up - lowers expectations for a cut. It's also been mooted that Iraq could up its production - in a move to gain market share, Kuwait, Iran and the United Arab Emirates - and Saudi itself - could also raise supplies in the third quarter. (SOUNDBITE) (English) CO FOUNDER, SEVEN INVESTMENT MANAGEMENT, JUSTIN URQUHART STEWART, SAYING: "I'll be interested to see whether finally the Saudis and also the Iranians could reach an agreement and even with the external group like the Russians. But history will tell us that's highly unlikely." Saudi is OPEC's largest producer and its de facto leader. But the era of fast oil could be coming to a close, according to one veteran OPEC watcher. U.S. shale providing a more fuel efficient alternative. Oil prices have recovered in recent weeks to around $50 per barrel. SOUNDBITE (English) IG SENIOR ANALYST, CHRIS BEAUCHAMP, SAYING: "We've seen a fantastic rally from the February lows but the risk is now for another meeting where they funk it where they fail to produce that right plan then you could see a lot of the gains from that mid Feb low unwound as people reassess their outlook for the oil market." Despite the doubts, latest reports suggest OPEC members may try to revive the idea of a coordinated output cut at this meeting - that's according to a senior OPEC official. Iran, though, apparently still signaling it would not be ready to join such a move.

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Will OPEC cut production?

Wednesday, June 01, 2016 - 01:40