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Oil drops more than 3 percent after Al-Falih remarks

2018-12-06 11:34 am | Resource: News | No Views : 41



 Saudi Energy Minister Khalid al-Faleh said on Thursday he was opposed to exempting Iran from any possible deal to cut OPEC output. He added that the Organization of the Petroleum Exporting Countries (OPEC) and other major oil producers are still studying all options, including the abandonment of production cuts.

According to Al-Faleh, the reduction of OPEC production + 1 million barrels per day would be sufficient to stabilize the oil market.

However, the Saudi official insisted that no agreement would be reached unless all Opec members and non-OPEC producers participating in the meeting "join" the proposed cuts. If any country refuses to cut production now, other exporters will wait until everyone agrees to adopt production cuts.

On Wednesday, Omani Oil Minister Mohammed bin Hamad al-Rumhi announced a preliminary agreement on production cuts between the OPEC + ministerial ministerial committee. The deal was questioned after Iran's Oil Minister Bijan Zanganeh said the country was planning to propose its exclusion from the proposed cuts until US sanctions against Tehran were lifted.

Al-Falih: Trump's "contribution" should be taken into account
 
Saudi Energy Minister Khalid al-Faleh told reporters on Thursday that "many members" of the Organization of the Petroleum Exporting Countries (OPEC) were already showing a drop in production and said planned voluntary cuts would be "smaller." Speaking in Vienna, he said that "geological factors and other factors" continue to contribute to the return of balance in the market, citing a reduction in production announced by more than 300,000 barrels per day in Alberta, Canada.

The senior official stressed that the decrease in the volume of discussions within the cartel today to provide coordination with the group of countries led by Russia should be less than 1.3 million barrels per day. Asked about US President Donald Trump's demand for OPEC not to reduce levels of exploitation, Al-Falih said the alliance would "take its contribution into consideration" along with the overall needs of consumers.

He pointed out that delegates have today and tomorrow every day to reach a final agreement. The minister acknowledged the need for "affordable energy" to make the economy grow.

Oil drops more than 3% after Faleh's statements

Crude prices fell on Thursday after Saudi Energy Minister Khalid al-Faleh said at a summit of the Organization of the Petroleum Exporting Countries (OPEC) in Vienna on Thursday, hinting to cut oil production by 1 million barrels a day. day. According to the Saudi minister, production cuts will only be adopted unanimously between OPEC and non-OPEC oil producers participating in the meeting.
  •  WTI futures for January delivery fell 3.23% to $ 51.23 a barrel at 10:58 CET.
  • Meanwhile, Brent crude for February delivery fell 3.18%, selling $ 59.65 a barrel.


Other analysis

OIL Technical analysis 14 December 2018

Time frame Used - four hours Oil is moving in a sideway direction in the near term. Oil is still facing resistance and selling pressure around levels of 52.66 - 54.54. In view of the technical indicators Both the RSI and Stochastic are indicating to weakness of the indicators. Therefore, we expect that the oil will test the level of 50.00 dollar, which by breaking it down will target the…

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