A drop in oil prices this month is likely to be short-term and will not deflect OPEC from its policy of keeping output high to defend market share, delegates from Gulf OPEC members and other nations said.
Falling Chinese stock markets and the Greek debt crisis have raised concern about demand, while the Iranian nuclear deal could lead to higher oil exports from the Islamic Republic. Benchmark Brent crude, trading below $57 a barrel on Wednesday, has fallen more than 10 percent in July.
OPEC, in a major policy shift, decided in November against cutting its production target of 30 million barrels per day (bpd) to prop up prices, seeking instead to defend market share against U.S. shale oil and other competing sources. The group reconfirmed the strategy at a meeting in June.
Kuwait’s oil minister, Ali Saleh al-Omair, was quoted on Tuesday expressing confidence in the outlook, saying producer countries expected stronger global economic growth to boost prices.
And three delegates from members of the Organization of the Petroleum Exporting Countries speaking this month said the price drop was unlikely to last and OPEC would not alter strategy, also citing expectations for stronger demand.
“I don’t think so, it is not time for OPEC to change,” said a Gulf OPEC delegate. “Demand will be more than in the first half (of the year) although there is some uncertainty about the economy. The prices will remain around $60.”