Baku, Azerbaijan, Oct. 19
By Aygun Badalova - Trend:
OPEC will fail to agree on production cuts before the end of 2016, and their often-stated wish to see cooperation with non-aligned petroleum exporters, such as Russia, will not be successful, analysts of the US JP Morgan bank said in the report obtained by Trend.
At the same time analysts acknowledge the strategic rationale of such an alliance.
"Although we assume there is no deal within OPEC before end- 2016, the pressures continue to mount for a shift in strategy," analysts said.
JP Morgan analysts expect a decline in non-OPEC supply varying between 0.1 million barrels per day to 0.5 million barrels per day year over year in 2016.
OPEC will hold a technical meeting of oil experts in Vienna on October 21. Eight non-OPEC countries - Brazil, Colombia, Azerbaijan, Kazakhstan, Norway, Mexico, Oman and Russia have been also invited to participate in the meeting.
Venezuela currently is an active player in efforts to bring together OPEC and non-OPEC producers and make coordinated production cut in order to stabilize oil prices.
The country is going to unveil a bold new oil strategy this month. The proposal would reapply the old mechanism of progressive production cuts to control prices, with a "first floor" of $70 per barrel and a later target of $100 per barrel.
OPEC last met this summer in Vienna, when it agreed to leave its production ceiling unchanged at 30 million barrels per day. The next meeting of the cartel will take place on Dec. 4.