On Saturday, the meeting between officials from Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC oil producing countries was held and aimed at building support for an OPEC goal of reducing output. This session occurred one day following OPEC members were unable to come to an agreement on how to implement the deal.
After arrival at the meeting with OPEC’s High-Level Committee of exporters, Azerbaijan, a non-OPEC member representative has comments that were supportive of the necessity for action from the producer to take measures to help raise up prices.
According to what Azerbaijan’s energy minister Natig Aliyev said to reporters outside of the OPEC’s headquarters, there would first be discussions regarding the recognized positions of the OPEC countries.
There had been a meeting one week earlier, according to Aliyev, with the president of Venezuela, an OPEC member, who had been pushing forward the measures to support prices.
Aliyev noted that there was an agreement between Venezuela and Azerbaijan that some of the actions would be taken to stabilize the market. The price of oil which the agreed upon was around {currency}60 per barrel.
Oil (LCOc1) is trading at closer to {currency}50 per barrel. This trading result is less than half the price it was in mid-2014 and is being weighed down by persistent oversupply and extracting out the incomes of exporting nations.
There was no mention of joint producer action by other non-OPEC officials.
When asked what he wished the meeting achieved, the deputy minister for Kazakhstan said: “the hope is that the price would react and will then increase.”
The Brazilian representative stated that his country was only at the meeting as an observer.
“There will be an increase in Brazilian production in the next few years,” said the Brazilian official Marcio Felix.
One of the world’s top producers, Russia, attending the meeting. Russian has been supporting the action with the OPEC to raise up prices. So far, Russia has not made any public comments in Vienna with regards to its standing.
Russian energy officials, as stated by two OPEC sources, told the those at the meeting that Moscow would still be willing to put a freeze on its level of output if there was an agreement of the OPEC to cap its production.
“Russia is ready. However, they want to see the figures agreed upon yesterday in details,” said one of the sources. According to another source, Russia would put a hold on if there was an agreement by the OPEC to reduce output.
On Friday, there was no agreement reached in a meeting of OPEC-only officials to work out and define the plan’s details for reducing oil production. Iran voiced its objections and had been reluctant even to put a freeze on its output levels, according to sources.
Last month in Algiers, the OPEC members agreed to lower the oil production of the OPEC to approximately 33 million barrels per day. Since 2008, this is the first output cut set by the OPEC, with a goal to help raise up prices.
Even though the OPEC High Committee does not make the policy decision, it will provide recommendations to the next ministerial meeting taking place on Nov 30 OPEC.
Mexico, Oman, and Bolivia, other non-OPEC countries, will be sending representatives to the talks on Saturday.
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