The world’s top exporter Saudi Arabia is expected to extend its further voluntary supply cuts to at least the first quarter, if not the first half of 2024, Amrita Sen, co-founder of consultancy Energy Aspects, said on Wednesday.
Current oil prices are not low enough to push the Organization of the Petroleum Exporting Countries and their allies, known as OPEC, to deepen supply cuts in 2024, she said at the FT Asia Commodities Summit. The next OPEC ministerial meeting will be held on November 26 to discuss the market outlook.
Brent prices are holding just above $82 a barrel, depressed by concerns about economic growth and demand, despite support for supply cuts by OPEC and its allies and conflict in the Middle East.
Washington lifted sanctions on Venezuela, which is expected to improve heavy oil supplies to the US and Europe at the expense of China, while oil from Russia and Iran continued to be exported despite sanctions.
“The problem still remains the underlying dichotomy with American policies,” Sen said. “They want to reduce revenues for Russia without disrupting flows.”
The US Treasury sent notices on Friday to ship management companies requesting information on 100 ships it suspects are violating Western sanctions against Russian oil, Reuters reported on Monday.
The move represents the biggest step of its kind by the US since Washington and its allies imposed a price cap aimed at limiting oil revenues to Moscow as punishment for its invasion of Ukraine.
For Iran, production increased by about 600,000 barrels per day, the Energy Aspects senator said, the OPEC producer exporting record volumes of oil to China.
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Updated: 17 Nov 2023, 17:16 IST