A sliding oil price could be just the start of something more serious next year for Opec, the oil cartel, and its close associate, Russia.
Three days of falling oil prices is not a crisis for OPEC, the weakening oil producer’s club, but forecasts of a continuation of the price decline could sap what strength remains in an organization once able to dictate the direction of the global economy.
“Soon, the Opec+ producers will once again see surging non-Opec oil production with the implied market balance returning to a significant surplus placing pressure on prices.By market management the IEA means production cuts by members of the club, especially Saudi Arabia.Cuts, however, will not be easy or welcomed by the Saudis who are finalizing the listing of their national oil champion, Saudi Aramco, on the Tadawul .
That means the burden of production cuts falls on Opec members, an unwelcome possibility as most are already being squeezed by the last round of cuts which might have helped stabilize the oil price, but did not deliver the price boost hoped for. McKinsey said the U.S. “is poised to"become the largest LNG exporter globally by 2022, overtaking Australia and Qatar”.
“Over 100 LNG projects totally 1100 million tons a year of capacity are competing to fill the 125 million tons a year supply gap by 2035; many of the marginal projects are from the U.S.”
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