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Saudi Arabia scared of us oil
Material posted: Publication date: 04-10-2013

Increased production of oil in the U.S. forced Saudi Arabia to reduce production of "black gold" to 9.5 million barrels. in day — the minimum level for the year. OPEC, the main member of which is Saudi Arabia, so just not going to give up — the organization will maintain the same level of oil production for 2013. Such tactics may signal the beginning of a price war in the market.

Saudi Arabia since the beginning of the year and regularly increasing its oil production. In particular, after Europe and the United States imposed sanctions against Iran, the country along with Kuwait and the UAE boosted production to maintain the level of OPEC production at the target level of 30 million barrels. a day. "Trio from the Persian Gulf is well worked, more or less stabilize oil prices in the second half of the year," The Financial Times quoted the head of Petroleum Policy bill Farren-price.

In June, the level of production in Saudi Arabia peaked in the 30 years to 10.1 million barrels. a day. Now, however, this figure fell to 9.5 million barrels. Changes associated with the fall in world demand and increase production "black gold" in the United States. Manufacturing in the United States grew this year at 760 thousand Barr., to 6.5 million barrels. a day. According to the forecast of the office of information in the field of energy, in 2013 it is the first time since 1992 will exceed 7 million bbl. By 2017, thanks to increasing production on the shelf of the USA will overtake Saudi Arabia and become the world's largest oil producer. Not by accident the US is now jokingly referred to as "Saudi America."

OPEC closely monitoring the success of Americans, but do not hurry to copy the strategy of Saudi Arabia to cut production. Yesterday at the meeting, the representatives of the organisation has left unchanged the target for oil production next year — 30 million Barr. a day. "We produce as much as we need markets. And they need more than 30 million barrels. to-day," — said the head of the Ministry of oil of the UAE Mohammed al-Hamli. Actually this mark is not a rigid ceiling: according to expert estimates, the production this year exceeded the target by 1.4 million barrels. While the OPEC member countries there is no strict production quotas. In the industry note that OPEC production is at the same level will lead to an oversupply of the commodity in the market. "If that happens, then oil prices will go down," said Commerzbank analyst Carsten Fritsch.

On the one hand, as the largest OPEC oil exporter, the decline in prices unprofitable. On the other hand, experts do not exclude that the organization can go on it to protect itself from the United States. The fact that production on the American shelf is advisable only when the prices for oil not below $ 44. per barrel, according to Rystad Energy. But even if the price falls to $ 60., companies have sharply cut production in North America to their business has remained profitable, according to Bernstein Research. And OPEC, which accounts for over 40% of the world's oil production can go on dumping, to take down a competitor. Tactics to OPEC is not new. In 1997, despite weak demand, OPEC increased its supply to the market, which led to the fall in oil prices to less than $ 10. per barrel. Later, OPEC has forced competitors to reduce production to stabilize prices.

However, most experts believe that OPEC is still will not unleash a price war, and the balance of supply and demand will be observed. "Monarchies of the Persian Gulf countries simply cannot afford the loss of income," said Petromatrix analyst Olivier Jacob. In particular, Saudi Arabia, by 2015 to balance its budget, it is necessary that the price of oil remained at $ 110., according to Institute of International Finance.


Julia Colchicina


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