India Urges OPEC Nations To "Fill Supply Gap", Ensure Sustainable Prices

Oil bumps up on US inventories decline, WTI pokes back into $65

Oil bumps up on US inventories decline, WTI pokes back into $65

Crude oil prices are trading lower early Thursday, but inside yesterday's range.

But Opec's crunch meeting in Vienna on Friday finds the oil cartel divided after almost two years of unity over production curbs, which were due to run until the year's end.

Tehran had previously resisted pressure by OPEC's de-facto leader Saudi Arabia to raise output.

When OPEC and its allies, which include Russia, Kazakhstan and Mexico, agreed to cut output in late 2016, they announced a 1.8 million-barrel-a-day reduction. The proposal has yet to win the backing of all OPEC members, and may meet resistance from more hawkish countries in the group including Venezuela and Algeria as well as Iran. Saudi Energy Minister Khalid al-Falih said on Thursday the world needed at least an extra 1 million bpd to avoid a shortage in the second half of 2018.

Trump has in recent months repeatedly blamed OPEC for a spike in oil prices, but Zanganeh said it was United States sanctions on Iran and Venezuela that had fuelled fears of a supply crunch and put pressure on prices. "Stay tuned." A decision to increase output could be taken with Iran refusing to sign up, as has happened before in Opec.

An authoritative OPEC source disclosed in a telephone interview with Vanguard, yesterday, that while Saudi Arabia has openly canvassed for a huge increase in supply, Iran said it would compromise on a small increase in OPEC oil output.

"OPEC is listening to consumers", Bob Dudley, the chief executive of BP Plc, said on the sidelines of the OPEC conference in Vienna.

He said the exact mechanics of any increase would be decided among all OPEC members on Friday. Prices have since fallen back slightly, to around $74, on market expectation that the Opec meeting will agree a rise in crude production.

Iraq and Venezuela have also opposed a relaxation of production cuts, fearing a slump in prices. Zanganeh was due to attend a ministerial committee on Thursday, two sources said.

The convoluted plan shows the difficulty Saudi Arabia has in bridging the gap between Russian Federation, which has pushed for a larger increase, and Iran.

Iran's Oil Minister Bijan Zangeneh said, "I don't believe at this meeting we can reach agreement".

OPEC sources said the final compromise also depended on whether OPEC agreed to mention US sanctions in the group's communique, an important point for Iran, which has blamed USA measures against Tehran for the recent rise in oil prices.

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