Several OPEC oil ministers who met over the weekend just three weeks before the June 22 meeting in Vienna that could result in an easing of the oil production cuts declined to tell media what the prevailing sentiment in the cartel was with regard to easing the cuts and raising production, S&P Platts reports.
The meeting included Saudi Arabia’s Khalid al-Falih, Kuwait’s Bakheet al-Rashidi, and Suhail al-Mazrouei, as well as Mohammed al-Rumhy from non-member Oman. The four met in Kuwait for an “unofficial consultative meeting.”
The only message the ministers cared to share with the media had to do with the need to continue cooperating and “sustaining the current partnership in order to continuously adapt to ongoing market dynamics in pursuit of the interests of consumers and producers.”
The tight-lipped behavior of the OPEC ministers is understandable in light of the latest price developments: last week oil prices plunged from three-and-a-half-year highs on reports that the Saudis and Russia may add as much as 1 million bpd of supply to offset crumbling Venezuelan production and possible loss of Iranian oil exports with the return of the U.S. sanctions.
Both Khalid al-Falih and Alexander Novak made a point of stressing that no decision has been made yet, and it will be made at the June 22 meeting if at all, but the excessive volatility of the oil market was yet again apparent in the price swing that immediately followed the reports.
Many analysts don’t think the group would add the reported 1 million bpd of supply, but the oil market lapped up the news and concerns about a return to oversupply have dominated the OPEC chatter news flow for nearly a week. As the June 22 meeting is drawing closer, oil prices will likely react to any new hint, comment, or report about OPEC’s efforts to “address consumer anxiety over security of oil supplies.”