Saudi Arabia Could Increase Production in the Background

Saudi Arabia will quietly add extra oil to the market over the next couple of months to offset a drop in Iranian production but is worried it might need to limit output next year to balance global supply and demand as the United States pumps more crude.

The kingdom, OPEC’s top producer, came under renewed pressure last week from U.S. President Donald Trump to cool oil prices ahead of a meeting in Algiers between a number of OPEC ministers and allies including Russia.

Sources confirmed to CNBC that Saudi Arabia is ready to put as much as 550,000 additional barrels onto the market. The gains will come from about 200,000 barrels per day from its Kurais oil field, as well as resumed capacity from some pipeline issues with the Manifa field.

Sources said though that this increased supply is reliant on demand. If demand is apparent, supply will grow accordingly, OPEC insiders told CNBC.

But Riyadh decided against pressing for an official increase now as it realized it would not secure agreement from all producers present at the talks, some of which lack spare production capacity and would be unable to boost output quickly.

via CNBC

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.