Oil Caps Biggest Three-Day Gain Since 1990 as OPEC Ready to Talk
Burden Sharing
OPEC won’t agree to carry the burden alone in propping up oil prices by cutting supply; non-member nations would have to share the burden, according to the group’s publication. If demand forecasts are correct, "then it is just a case of riding out the storm" and waiting for the market to balance.
"The market is reading way too much into this," Mike Wittner, head of oil-market research at Societe Generale SA in New York, said by phone. "The OPEC Bulletin isn’t an important publication and this isn’t how they would make a key announcement."
OPEC has been boosting supply as it seeks to force higher- cost producers to cut output. The group has exceeded its target of 30 million barrels a day for a year, data compiled by Bloomberg show. Saudi Arabia, OPEC’s top producer, pumped 10.57 million barrels a day in July, the most in monthly Bloomberg data going back to 1989.
Saudi Arabia
"The non-Gulf members screamed in the fourth quarter of 2014 because of falling prices, were quiet in the second quarter because they rose, and are now at it again," Wittner said. "Until Saudi Arabia says something this is all meaningless. Why would the Saudis change their logic and waste all they have already done."
OPEC crude output increased by 108,000 barrels to 32.316 million a day in August, according to a Bloomberg survey of oil companies, producers and analysts.
Russian President Vladimir Putin and Venezuelan counterpart Nicolas Maduro will discuss oil prices and cooperation between Russia and OPEC, Kremlin aide Yuri Ushakov told reporters in Moscow.
The Energy Information Administration trimmed its U.S. production forecast for the first five months of the year as it switches to a new survey, the agency said. The U.S. pumped about 9.44 million barrels of crude a day during the period, down from a previous estimate of an average 9.53 million.
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