Arab Today, arab today iransaudi crisis punches another hole
Last Updated : GMT 08:29:34
Arab Today, arab today
Arab Today, arab today

In OPEC unity

Iran-Saudi crisis punches another hole

Arab Today, arab today

Arab Today, arab today Iran-Saudi crisis punches another hole

Rabigh Refining & Petrochemical Co. facilities, 120 km north of the Red Sea Saudi city
Paris - Arab Today

Escalating diplomatic tensions between Iran and Saudi Arabia have added fresh strains on OPEC's unity as the cartel grapples with a common response to rock-bottom oil prices, experts said.

While it produces a third of the world's oil, the group has struggled with crude values that have tumbled some 60 percent since mid-2014, falling below $40 (37 euros).

Crafting a new way forward has become yet tougher since Saudi Arabia executed prominent Shiite cleric Nimr al-Nimr at the weekend, triggering a sectarian standoff with Iran.  

"What's happening at the moment between Iran and Saudi Arabia makes searching for a compromise even more difficult," said Francis Perrin, president of Strategy and Energy Policy publications.  

Gulf countries, led by top OPEC producer Saudi Arabia, refuse to cut production unless the oil-producing states that are not members of group agree to do the same. A cut would likely help prices climb.
Though the Saudis have thus far had their way, this unbending stance has been financially painful for the 13 OPEC nations, including Algeria, Venezuela and Nigeria, which draw most of their revenues from black gold.  

For its part, Iran, the other pillar of OPEC, has no intention of curbing its production with the lifting of Western sanctions just on the horizon, which would allow it to resume crude oil exports.  

"OPEC has no policy at the moment as it's everyone for themselves," said Ole Hansen, a Saxo Bank analyst.  

"In the short term, there is no chance of an agreement within OPEC regarding production, and assuming there was some small chance, it has disappeared with the current crisis in relations between Saudi Arabia and Iran," said Pierre Terzian, head of the Petrostrategies weekly.

- 'Coming to blows' -
In addition to their political and religious rivalries, the two Middle Eastern powerhouses are also clashing over their share of the oil market.

From Iran's perspective, "it would be fair" for other OPEC members, including Saudi Arabia, to "cut their production in 2016 to make some room (for Iran) without pushing prices down further," said Perrin.  

However, in Riyadh "additional revenue means Iran will have a greater capacity to be a nuisance," in the region, Perrin added.   

On top of that the kingdom, which has been overtaken in production by the United States, has not given a second's thought to cutting its output.

At the end of December Saudi Oil Minister Ali al-Naimi said "we no longer limit production. If there is demand, we will respond. We have the capacity to respond to demand", according to the Wall Street Journal.

Terzian said: "Clearly, that means Saudi Arabia is not going to let Iran increase its oil exports on its own... instead, it will also boost its own production."

Still, OPEC has survived previous conflicts among its members, notably during the 1980-1988 war between Iran and Iraq.

"The only place where Iranian and Iraqi leaders were able to see one another without coming to blows was at OPEC," said Perrin.

Christopher Dembik, a Saxo Bank analyst, sees a common interest between the two nations that may also be a stabilising force.

"They are both trying to recapture lost market share. They have a medium-term interest, at least, to keep prices low. Therefore they have no choice, but to agree, at least on this point."
Source: AFP

2 1

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today iransaudi crisis punches another hole Arab Today, arab today iransaudi crisis punches another hole

 



Arab Today, arab today
Arab Today, arab today Prepares to present her new collection

GMT 14:29 2017 Monday ,20 February

Prepares to present her new collection
Arab Today, arab today Tourism shows signs of recovery

GMT 09:59 2017 Monday ,20 February

Tourism shows signs of recovery
Arab Today, arab today Sarah Belamesh designs antiques of "ceramic"

GMT 19:45 2017 Monday ,20 February

Sarah Belamesh designs antiques of "ceramic"
Arab Today, arab today 11 family members dead in rebel push

GMT 07:57 2017 Tuesday ,21 February

11 family members dead in rebel push
Arab Today, arab today Murder of 2 reporters in Dominican Republic

GMT 22:45 2017 Thursday ,16 February

Murder of 2 reporters in Dominican Republic

GMT 10:06 2017 Friday ,17 February

South Korea's Hanjin Shipping declared bankrupt

GMT 09:26 2017 Friday ,17 February

Samsung's history tainted by run-ins with the law

GMT 09:20 2017 Friday ,17 February

Samsung heir arrested in corruption probe

GMT 10:26 2017 Thursday ,16 February

Dollar, equities stutter in Asia after Trump rally

GMT 08:45 2017 Thursday ,16 February

Hanjin saga reveals S.Korea corporate governance flaws

GMT 09:40 2017 Wednesday ,15 February

Heineken profits drained in 2016 by currency turmoil

GMT 09:10 2017 Tuesday ,14 February

Sharjah Chamber Eyes Strong Economic Ties with Belgium
View News in Arabic - Business: أخبار الأعمال
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today Kidogo provides childcare for underserved

GMT 20:24 2017 Wednesday ,15 February

Kidogo provides childcare for underserved
Arab Today, arab today Tragic fluctuations of Bakhtiari's life revealed

GMT 06:50 2017 Wednesday ,15 February

Tragic fluctuations of Bakhtiari's life revealed
Arab Today, arab today London to tax old cars

GMT 14:06 2017 Friday ,17 February

London to tax old cars
Arab Today, arab today Pluto's unruly moons

GMT 06:31 2015 Thursday ,04 June

Pluto's unruly moons
Arab Today, arab today Nissan enhances sales in most markets

GMT 14:08 2017 Monday ,20 February

Nissan enhances sales in most markets
Arab Today, arab today Competes Sweden and Germans by S90

GMT 22:36 2017 Thursday ,16 February

Competes Sweden and Germans by S90
Arab Today, arab today Ahmed Fahmy stresses he did not ignore singing

GMT 06:34 2017 Sunday ,19 February

Ahmed Fahmy stresses he did not ignore singing
Arab Today, arab today Teach monkeys to recognize themselves in mirror

GMT 20:41 2017 Wednesday ,15 February

Teach monkeys to recognize themselves in mirror

GMT 21:11 2017 Saturday ,18 February

Egypt to hold first session of Arab film festival

GMT 06:40 2017 Friday ,10 February

MP calls for removing text from Islamic story

GMT 19:10 2017 Friday ,17 February

Hats, scarves add beauty to women

GMT 10:26 2017 Tuesday ,14 February

Emergency UN meeting in Harare

GMT 23:29 2017 Thursday ,16 February

Home built on sand castles-style costs $8m

GMT 14:51 2017 Monday ,20 February

Ways to acquire presentation skills

GMT 19:16 2017 Friday ,17 February

Aziz House ready to host the tourists

GMT 13:12 2015 Saturday ,09 May

Sheikh Sultan opens Sharjah Centre

GMT 12:39 2017 Monday ,20 February

newest smartphone another winner for Huawei

GMT 13:16 2017 Tuesday ,14 February

First fashion model with Down syndrome
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday