The scenario was not on the agenda of the biannual meeting of the Organization of the Petroleum Exporting Countries (OPEC), held on 5-6 December in Vienna, Austria. However, he arrived on the table as soon as work began. And after long hours of tight negotiations at the cartel's headquarters, its fourteen members, Russia and a few OPEC + countries have agreed to further reduce production by 500,000 barrels per day in the first quarter. 2020 compared to production in October 2018, which will bring the cuts to 1.7 million barrels.
At the end of the summit on Friday afternoon, the new Saudi energy minister, Prince Abdelaziz Ben Salman, even created a new surprise by announcing a "Beautiful news", kept secret by OPEC members for twenty-four hours: Riyadh "Will continue to voluntarily reduce production by 400,000 barrels" below its official goal. It would reach its lowest level since 2014, when the black gold had tumbled below the $ 100 mark, according to Bloomberg. In total, the overall decline would reach 2.1 million barrels per day.
The goal of raising prices was achieved: in London, Brent immediately gained 1.92% (to 64.61 dollars); and in New York, the US barrel of WTI for delivery in January was 1.85% (at $ 59.51). Markets are not overly illusive. The Saudi Arabian national company, Saudi Aramco, was already pumping below its OPEC quotas to avoid lower prices.
It is not certain that Saudi voluntarism is enough to calm the markets, shaken for a year by several destabilizing factors: the trade war between Washington and Beijing, which restricts Chinese growth very greedy oil, especially from the Arabian Gulf. Persian; the sluggishness of the European economies, the end of which we can not see; the dynamism of American production, even if it slows down; and high inventories of crude and refined products.
Political stability and economic development
This OPEC + group, which accounts for half of the world's oil production, will meet again in March 2020 to take stock of the effects of the measures decided on Friday. He was born in December 2016 to counteract the rise of American shale oil producers. All depend on the price of black gold for their political stability and / or their economic development, and all fear that the barrel falls below 50 dollars, as in early 2019. A price too low to allow them to balance their budget .
