Crude Falls as Saudis Deny Production Cut Agreement

Saudi Arabia is seen rejecting calls from fellow OPEC members to cut output when the group meets this week as the group’s kingpin argues it cannot deal alone with one of the most severe oil gluts in history.

OPEC is widely expected to stick to its policies – enforced by Saudi Arabia’s oil minister Ali al-Naimi a year ago – of defending market share by pumping record volumes to drive rival, higher-cost producers out of the market.

“I hope this time it will be different, but I doubt it will be,” said an OPEC delegate from a country usually seeking production cuts.

Three other delegates said they still saw no indication an agreement on cuts was likely to be reached on Friday.

While the Saudis can claim a partial victory over the U.S. shale oil boom, production from top non-OPEC rival Russia has kept surprising on the upside and its own members Iraq and Iran are set to add new barrels. World oil stockpiles are at a record, according to the International Energy Agency.

Venezuelan President Nicolas Maduro on Wednesday said his country, one of OPEC’s traditional price hawks, would push for a 5 percent output cut at the Friday meeting. OPEC is producing some 1.7 million barrels per day above ceiling.

via Reuters

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