OPEC split signals unchanged quota as compromise
Divisions within OPEC signal the group will probably keep its crude production ceiling unchanged tomorrow as falling prices limit Saudi Arabia’s ability to justify a higher quota. Iran, facing a European Union embargo on its oil exports, and Venezuela have been joined by Iraq, Angola, Libya and Ecuador in saying that global crude supplies are already excessive. The group’s biggest producer, Saudi Arabia, is pumping near its highest level in three decades and said June 11 that there may be a need to boost the target. Leaving the production quota unchanged may be the likeliest compromise because it allows smaller producers to protect revenue after Brent crude’s 23 percent decline since March, while preventing a price rally that would curb economic growth. The 12 members of the Organization of Petroleum Exporting Countries are meeting in Vienna a year on from a gathering that ended without consensus, prompting Saudi Oil Minister Ali al- Naimi to say that it was “the worst” he had ever attended.
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