OPEC’s failure to agree cut to be disaster, warns expert
Baku, Azerbaijan, Nov. 30
By Leman Zeynalova – Trend:
An energy security expert believes that it will be tricky for OPEC to reach a deal in Vienna today.
“It will be tricky. But given the amount of political capital invested, if they do not have a deal, oil prices will almost certainly plummet. That will be a disaster for OPEC,” Sijbren de Jong, an analyst at The Hague Center for Strategic Studies and an expert in energy security, told Trend Nov. 30.
He pointed out that basically, OPEC members have to get some kind of deal but Saudi Arabia has been playing hardball, and Iran and Iraq are not giving way.
“If they cut, it will have to be Saudi Arabia that does the cut,” said Sijbren de Jong, adding, “Other countries either cannot afford (think Venezuela, Algeria) or do not really want to (Iran, Iraq).”
As for Russia's position regarding the deal, the expert noted that Moscow’s cooperation history with OPEC has been abysmal.
“Russia always says it supports an OPEC decision, but at the end of the day they rarely do anything,” he said, adding that the country “wants to do a freeze and sell this as a cut.”
In September, OPEC producers agreed during an informal meeting in Algiers to cut down the oil output to 32.5 million barrels per day (bpd) from current production of 33.24 million bpd.
How much each country will produce is to be decided at the next formal meeting of OPEC on Nov. 30 in Vienna.