OPEC has to do something very soon, we don't agree with SA Venezuelan oil minister says OPEC cannot allow a price war
Reuters – 10 minutes ago
TEHRAN (Reuters) - OPEC cannot allow an oil price war and must take action to stabilise the crude market soon, Venezuelan oil minister Eulogio del Pino said on Sunday.
"OPEC has to do something very soon ... We don't agree with the position that says the market some way is going to dictate the price of crude oil. We don't agree with that position of Saudi Arabia," del Pino said on the sidelines of the Gas Exporting Countries Forum (GECF) Summit in Tehran.
"Iran is announcing its production is going to increase as soon as they lift the sanctions and we need to do something. We (OPEC) cannot allow going into a war of prices. We need to stabilise the market."
When asked how low oil prices could go in 2016 if OPEC doesn't change its policy, he said: "Mid-20s."
Del Pino also said Russia will not attend an informal OPEC meeting on Dec. 3.
Venezuela had made a proposal in Vienna on Oct. 21 about an equilibrium price that could stabilise the market, del Pino said, repeating that the equilibrium price where future investments can continue to replace a natural decline in production is at the level of $88.
He said low oil prices will affect future oil investments which could mean not meeting future demand growth for oil and that could lead to a spike in prices later.
"And we don't want that kind of cycle of low price and high price, it is not good for consumers or producers. We need to send to the market a signal of stabilisation, and that signal of stabilisation is not what we are doing now.... We are destroying the price of crude oil. The speculative market is the one that is controlling the market," he added.
https://ca.finance.yahoo.com/news/venezuelan-oil-minister-says-opec-cannot-allow-price-141836246--finance.html
This seems to be the only OPEC oil minister that makes any sense. The real question is if the Saudi's give a hoot about Venezuela or anybody else for that matter? Seems to me SA has clearly demonstrated they only care about themselves and nothing will change no matter what or how loud Venezuela cries or the rest of the world either. If the worlds oil producers do nothing and continue on this path, I agree, the future for oil will be a lot more expensive once this finally shakes out. Many companies will go under, lots more layoffs, capital will be cut even more and so on which will eventually set the world up not to be able to ramp up production fast enough to meet demand due to the lead time required to get new projects online to replace the natural decline. Question is just how long will this take to play out, looks more and more like years now, very disappointing to say the least. kmapp