Output freeze deal can lead to rise in oil prices - expert
Baku, Azerbaijan, Feb.17
By Anakhanum Khidayatova - Trend:
With the agreement in Doha on freezing the oil output, OPEC and non-OPEC members may soon see relief in their operations and a more positive price in the medium term that helps their state budgets, Theodore Karasik, Senior Advisor, Gulf State Analytics told Trend.
Following the talks in Doha on Feb.16, energy ministers of Russia, Saudi Arabia, Venezuela and Qatar agreed to freeze the oil output at Jan.11 levels, as long as the others follow the suit.
Today, the proposals on output freeze will be discussed by oil ministers of Venezuela, Iran and Iraq in Tehran.
Some may interpret the move as related to the war for Syria, as Saudi Arabia and Russia looked to be on the verge of confrontation through their allies and proxies, according to the expert.
Russian economy needs relief and now, it may find some breathing space, Karasik added.
"But we need to be careful and not pop any champagne bottles yet. There is still geopolitics at play across a number of dimensions," the expert said.
A moderate growth was observed in world oil prices on Feb.17. The price of April futures for North Sea Brent crude oil mix rose by 1.07 percent and reached $32.52 per barrel on Feb.17. This is while the price of March futures for WTI oil increased by 0.64 percent and stood at $29.23 per barrel.
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