February 28, 2024

Solid State Lighting Design

Find latest world news and headlines today based on politics, crime, entertainment, sports, lifestyle, technology and many more

The Saudi Oil Minister warns market speculators to be “cautious” ahead of the OPEC+ meeting

The Saudi Oil Minister warns market speculators to be “cautious” ahead of the OPEC+ meeting

Abdulaziz bin Salman, Saudi Arabia’s energy minister, speaks during a panel discussion at the Qatar Economic Forum in Doha, Qatar on May 23, 2023.

bloomberg | bloomberg | Getty Images

On Tuesday, Saudi Oil Minister Prince Abdulaziz bin Salman told market speculators to “beware,” and repeated his warning that they may face pain in the future.

“Speculators, as in any market, are there to stay. I keep advising them to take a hit. They did in April. I don’t have to show my cards, I don’t have to.” [a] he said during a session focused on energy at the Qatar Economic Forum in Doha.

The Saudi oil minister had previously launched an attack on oil price speculators looking to cash in on anticipating the production decisions of OPEC+, which meets on June 4th.

Recently, several members of the OPEC+ alliance voluntarily announced – and independently of the group’s broader strategy – that they would cut their crude oil production by 1.6 million barrels per day. The move briefly boosted prices, which have since given up the gains. Brent icy July-end futures were up 50 cents a barrel from the May 22 settlement of $76.49 a barrel by 12:05pm London time.

OPEC+, a group of 23 oil-producing countries chaired by Saudi Arabia, decided in October to cut production by 2 million barrels per day in a bid to boost prices, given concerns about global consumption. This move was met with an immediate response from the United States due to the pressure on fuel-consuming households.

“OPEC+ was blamed in October in April. Who has the right numbers? Who measured the situation in a responsible, but attentive way?” Abdulaziz said on Tuesday.

See also  Stock Market Today: Live Updates

“I think that over the past six to seven months, we have proven that we are a responsible regulatory institution,” he added, noting that the market is witnessing constant fluctuations and requires OPEC + to remain proactive and protective.

In the weeks after announcing voluntary cuts in April, crude oil prices fell on the back of banking unrest, signs of a recession, Beijing’s slower-than-expected reopening, and the subsequent increase in demand from China, the world’s largest importer of crude oil.

Market watchers are now wondering whether OPEC+ will head in June for another decline in production as a crutch for prices, even as the Paris-based International Energy Agency sees deep supply pressures looming.

“The current market pessimism … stands in stark contrast to the tighter market balances we expect in the second half of the year, when demand is expected to outpace supply by about 2 million barrels per day,” the IEA said in its latest Oil Market Report. . May report.

However, the organization’s executive director Fatih Birol on Sunday told CNBC that the prospect of a US debt default – if unlikely – could lead to a drop in oil demand and prices.

In a May 17 note, analysts at Swiss bank UBS slashed their Brent price forecast by $10 per barrel to $95 per barrel by the end of the year, given higher-than-expected crude oil volumes and recession fears. They expect the market to be short of about 1.5 million barrels per day in June.

“With many OPEC+ member countries voluntarily removing barrels from the market, and amid rising demand during the northern hemisphere summer, we expect a larger inventory draw to materialize and bring investors back into the oil market,” they said.

See also  Bernie Sanders, AOC visit a rally for Staten Island workers at Amazon union

On Tuesday, the Saudi oil minister also stressed the risks of market uncertainty, along with the gradual depletion of spare capacity in producing countries — an argument he has previously made public to call for increased investment in fossil fuels, as well as spending on renewable energy projects.

“Look at where we are now: energy security is constrained, and capabilities are running out because countries are not investing in both oil and gas,” he said.

“We have a very funny trajectory where demand is going to be. So if you hedge, as we are, we will have to take action to preempt any possibility of further volatility (…) but we accept the challenge frankly and we will continue to be challenged.”