OPEC Deal Going Off the Rail

[Marina Schwarz + 1,576]

There's internal disagreement in OPEC as to what the best price of oil should be. The crack is between Saudi Arabia and Iran. Saudis want it at $70 and Iran's fine with $60 a barrel. Meanwhile US exports are eating into OPEC's Asian market share. Iran's oil minister suggested a gradual restart of production could happen after June. What's troubled kingdom with a huge IPO on the way to do?

[Rodent + 1,424]

3 hours ago, Marina Schwarz said:

There's internal disagreement in OPEC as to what the best price of oil should be. The crack is between Saudi Arabia and Iran. Saudis want it at $70 and Iran's fine with $60 a barrel. Meanwhile US exports are eating into OPEC's Asian market share. Iran's oil minister suggested a gradual restart of production could happen after June. What's troubled kingdom with a huge IPO on the way to do?

There is absolutely nothing that Iran can do here. Saudi's are going to keep cutting to keep oil at $70. The IPO is being pushed into 2019--to the surprise of almost no one. Iran, while it is a large producer, doesn't have enough weight to throw around here. The Russia/Saudi duo will determine the output of the group. They have the most clout, and the cut deal will go exactly as they want it to. Iran can make some trouble (forcing The Kingdom to produce less to compensate), but it will be insufficient. Saudi can always pump less. They have already shown that they are willing to cut more to keep prices where they want them. They haven't successfully kept it at $70, but they are working to get it there.