The Ministerial Council of the Organization of «OPEC» did not take a new decision on production in the semi-annual conference, which was held on 2 June in Vienna. And it managed The surprise move to observers that the organization helps to contain differences over production policy, ie to freeze production at the level of January, as demanded by Saudi Arabia, or to increase production, and calls on Iran. The organization has achieved another important goal is to focus on the stability of the markets and to maintain the momentum in a gradual increase in prices that started ranging around $50 a barrel.
It was clear that contain differences and interest balances supply and demand in the market, rather than focusing on curbing increasing production and sharp public between the parties concerned and differences, it helped the success of this conference. And contributed to the positive atmosphere in the Congress in knots solution has long been a source of friction in the organization during the past years, appointed the new Secretary-General Mohammed Sanusi Barkindo (Nigeria) After consecutive renewals of the mandate ended his predecessor, Abdullah al-Badri of Libya. Michael Crawford Quantum Code
Fundamentals of the market and played an important role in the success of this consensual politics, especially the Ministerial Council of the 2016 forecast. After supplies from outside the «OPEC» countries began to decline during 2015, the Board expects for 2016 continuing declines by 740 thousand barrels per day extra, and the main reason is the market factors (price collapse). Organization estimates that overall declines constitute more than one million barrels per day from the highest rate recorded by countries outside the «OPEC» in 2015. Michael Crawford Quantum Code It projected that the demand is increasing this year by 1.2 million barrels a day, after the increase recorded in 2015, which amounted to 1.5 million barrels per day.
The agency’s final communique of the Ministerial Council that «the rise in demand remains healthy in light of the challenges of the global economic developments.» Council and draw attention to the average prices since the last congress in December (December) in 2015, as prices have risen more than 80 percent since Quantum Code then, falling oil reserves. The Board concluded that these developments are tangible evidence of the return of balance to the market, degradation prices cut production countries with high cost crudes. The findings mean the health of Saudi policy of non-interference in the market and let prices determine market factors. It also means continuing a policy-led Saudi Arabia as they began to achieve its goals.
He said Energy and Industry and Mineral Resources, Saudi Minister Khalid al-Falih bulletin Quantum Code: «Saudi policy was confident for a long time that the markets will re-balance. There are two factors for the return of the balance – supply and demand. Relative to demand, we have noted how price in demand affects … As we have seen the demand for oil buoyant during 2015, and continued this recovery during the first quarter of 2016 … We believe therefore that demand improved greatly reduced in higher oil production costs, namely index important to return the balance to the markets. The result of such factors to reduce inventory and that’s what really started. We believe that these factors will accelerate the march whenever we move forward, especially with the increasing demand and low supplies. »
Falih also addressed in this interview to the anxiety that prevails in markets around the decline in oil investments as a result of the deterioration of oil prices, he said: «shrinking investments and their impact on the volume of supply is concerned. As we have seen how to increase investment in the past decade because of rising prices, which led to increased supplies during 2014 – 2015 and continuing until now to some extent, will leave the low investment now impacts over time. This must be managed with caution. It is clear that to attract investments again requires reasonable prices. » He added: «We kept in Saudi Arabia on our investment. Extended periods of us and some service projects and support. But at the same time we continue to implement our software investment as planned. »
He said Iranian Oil Minister Bijan Zanganeh after the conference: «There was an atmosphere of cooperation and understanding. All ministers agreed on the fundamentals of the market ». Iran has achieved as a result of this conference tacit approval to increase its production, as called for agreement on quotas for the production of the future, it was clear that the Iranian position of the quota system was not urgent at this conference. Iran’s ambassador to the «OPEC» Quantum Code System said the newspaper «adopt» Iran on June 2: «can adjourn the debate on the subject of quotas until prices return to a reasonable level and the stability of the market in a good picture. Due to the large production increases in some OPEC countries, such as Iran, Iraq, lower production in the others, the quota now is a complex subject and will take a long time, because the quota Michael Crawford Quantum Code system requires productive stable for a reasonable period of time, and this is not available or possible now. So we believe that we can achieve in the future. »
The question remains: Are the low supplies essential factor or timer? Fires in Canada will be followed by re-production after examining the affected areas. Michael Crawford Quantum Code Is it possible to return production from shale Continental quickly and at full capacity or low card? How much is the extent of the damage? And what is the time required to complete the repairs? There are questions about the lack of supplies from Libya, Nigeria and Venezuela, but no clear answers about the relative political stability in these countries. There are questions about the return of large-scale production of shale oil, but this will depend on the economics of the sector, Returning to the range 60 – $ 70 for a barrel of the US benchmark oil may contribute to the promotion of this production.