Russia, Saudi Push For Big Hike In Oil Output Despite Iran Opposition

 Russia and Saudi Arabia are pushing OPEC and its allies to raise oil output steeply from July to meet growing demand and cover supply outages in Venezuela and Libya despite opposition from several members of the producer group including Iran.“Oil demand usually grows at the steepest pace in the third quarter ... We could face a deficit if we don’t take measures,” Russian Energy Minister Alexander Novak told reporters. “In our view, this could lead to market overheating.” Novak said Russia wanted OPEC and non-OPEC to raise output by 1.5 million barrels per day (bpd), effectively wiping out existing production cuts of 1.8 million bpd that have helped rebalance the market in the past 18 months and lifted oil prices LCOc1 to $75 per barrel from as low as $27 in 2016.

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They ask for 1.5 million barrels but they would be happy if they get half of that.  And 750'000 b/d is by the way close to the combined outages in production from Venezuela, Libya, Mexico, Angola...

I think there is room for a compromise around a 750'000 b/d increase. The countries with a remaining capacity could produce instead of those with production problem and give them something in exchange for renting part of their quota. This would allow to increase the output without having to change the existing 1.8 million bdp cut.

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Alliances are changing, the political landscape is more fluid than it has ever been....There is a chance that OPEC fractures.

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Saudi's want too up oil production with Russia by 500K a day starting on July 1st. The 3 other  members of Opec Iran, Iraq, and Venezuela will vote against it. House of Saudi banking cartel needs $$. 

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Seems pretty straightforward to me that a relative compromise of 500k bpd increase will likely get bulldozed through by the heavyweights Saudi Arabia and Russia, leaving the "lesser equals" of the remaining OPEC countries to whinge and whine to no avail.

OPEC + Russia's new motto appears to be:

"All oil producers are equal but some oil producers are more equal than others."

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