Iran
Re: Iran
On Sunday, Iran's oil minister Bijan Zanganeh called for an emergency OPEC meeting to stabilize prices.
As world commodities markets slumped to six-year lows last week and into the weekend, he said, “Iran endorses an emergency OPEC meeting and would not disagree with it.”
Algeria, another OPEC member, also called for an emergency meeting earlier this month in order to boost prices after a year of shrinking profits for world oil producers.
China's stock market dropped 8.5% this morning. The state's news agency, Xinhua, is calling it “Black Monday.”
China is the world's biggest importer of fossil fuels, and with its economy slowing down, lower demand has crushed oil prices, copper prices, and other industrial exports.
An emergency OPEC meeting could boost prices if the member countries decide to curb output, which is near record highs.
If you'll remember, it was last fall that OPEC member and pseudo-leader Saudi Arabia decided to cut prices to China and boost its output in a move to protect market share after U.S. shale oil sent ripples through the world's oil market.
What's more, many OPEC members feel that a meeting and a production cut won't take place without the approval of the Saudis.
While I'm sure the Saudis would like to make more money off of oil production through higher prices, the Kingdom would also be reluctant to give up market share, as it's said many times over the last year.
And even though Saudi Arabia and Iran are OPEC members, the two countries don't exactly get along. A Saudi go-ahead on an emergency meeting at the behest of Iran seems highly unlikely.
Especially when you take into consideration Zanganeh's other comments on Sunday: “We will be raising our oil production at any cost and we have no other alternative.”
MY TAKE: OPEC members are putting pressure on Saudi Arabia. All OPEC has to do to raise oil prices back to $60 is say they are going to cut production back to the old quota of 30 million barrels per day. However, convincing SA that they will actually abide by the quotas may be difficult. - Dan
As world commodities markets slumped to six-year lows last week and into the weekend, he said, “Iran endorses an emergency OPEC meeting and would not disagree with it.”
Algeria, another OPEC member, also called for an emergency meeting earlier this month in order to boost prices after a year of shrinking profits for world oil producers.
China's stock market dropped 8.5% this morning. The state's news agency, Xinhua, is calling it “Black Monday.”
China is the world's biggest importer of fossil fuels, and with its economy slowing down, lower demand has crushed oil prices, copper prices, and other industrial exports.
An emergency OPEC meeting could boost prices if the member countries decide to curb output, which is near record highs.
If you'll remember, it was last fall that OPEC member and pseudo-leader Saudi Arabia decided to cut prices to China and boost its output in a move to protect market share after U.S. shale oil sent ripples through the world's oil market.
What's more, many OPEC members feel that a meeting and a production cut won't take place without the approval of the Saudis.
While I'm sure the Saudis would like to make more money off of oil production through higher prices, the Kingdom would also be reluctant to give up market share, as it's said many times over the last year.
And even though Saudi Arabia and Iran are OPEC members, the two countries don't exactly get along. A Saudi go-ahead on an emergency meeting at the behest of Iran seems highly unlikely.
Especially when you take into consideration Zanganeh's other comments on Sunday: “We will be raising our oil production at any cost and we have no other alternative.”
MY TAKE: OPEC members are putting pressure on Saudi Arabia. All OPEC has to do to raise oil prices back to $60 is say they are going to cut production back to the old quota of 30 million barrels per day. However, convincing SA that they will actually abide by the quotas may be difficult. - Dan
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group