Saudi Arabia is putting its crude production capabilities – and its ability to balance the oil market – to the test. The kingdom finds its oil production policy at a crossroads, with the need to appease allies countered by its desire for higher prices to balance its books. Urged by US President Donald Trump to cool what was then a heating market, Saudi Arabia pledged June 23 along with the rest of OPEC, Russia and nine other non-OPEC partners to boost crude output by a collective 1 million b/d, in anticipation of supply shortages caused by US sanctions on Iran and Venezuela’s spiraling economic crisis. Even before the ink had dried on the vaguely worded OPEC deal — which spelled out no specific quotas — Saudi officials were letting it be known to analysts that the kingdom was ready to pump as much as 11 million b/d, which would be a record high by far. But after an initial surge in output in June, Saudi Arabia said it was forced to cut production by some 200,000 b/d in July to 10.29 million b/d, due to lackluster demand, in what analysts said was likely an attempt to prevent prices from falling… continue reading
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Source: CTRM Center