A report by Bloomberg indicates that the members of
the OPEC+ feel that the alliance must meet much more frequently than it does
now, in order to gauge the oil market and then respond to demand with a firm
focus on the revenues.
The two major players of the OPEC+, which had been
at loggerheads in the past, especially during the early phase of the pandemic,
do not seem to see eye-to-eye yet on the same issue.
They, however, do not appear to be poles apart
either, as they were at the height of the Coronavirus crisis, until President
Trump intervened and used his special talent that he always claims to possess –
doing a deal while bringing warring factions together.
During the pandemic, Saudi Arabia wanted to cut the
production drastically in order to stabilize the price, which saw plummeting the price below
zero on April 20 for the first time.
Russia, on the other hand, wanted to keep pumping
oil in order to bolster its coffers, having been hit by the sanctions by the West
and rapid increase in virus infections.
The bone of contention between the two members left
the rest in a damaging lurch.
Russia is still keen on increasing the production
while assuming that the oil price will remain in $45 – 50 range in the foreseeable
future. Saudi Arabia, meanwhile, wants to exercise caution in the light of the discovery
of new variants of the Coronavirus across the globe.
Analysts were not deterred by the forthcoming OPEC+
meeting or the speculative production boost.
On the contrary, they kept investing as the usual factors such as US oil
inventories dropped and rig count went up.
The disagreement is not just confined to the stratum
of two players in the cartel. The report highlights the disagreement between
some friendly Gulf neighbours too.
In this context, the nature of difficult discussions can
be mimicked by a tanker that negotiates a volatile strait, when opposing sides lay
siege sticking to their guns.
