was that it didn’t want to extend the cuts and instead favored sticking to the original agreement to ease them from July. But a person familiar with its position said on Tuesday it was advisable to find a compromise. In March, Moscow resisted a Saudi-led proposal to deepen production cuts as coronavirus spread; talks broke down and the kingdom launched a price war that crippled producers and left gaping holes in countries’ budgets.
“We do not believe there will be repeat of the March meltdown,” Helima Croft, head of global commodity strategy at RBC, said in a note. “We think they will seek to split the difference by agreeing to a one to three-month extension.”With Brent crude rising past $40 a barrel on Wednesday for the first time since early March, Saudi Arabia and Russia face another challenge as they weigh up how to manage the recovery: U.S. oil shale companies are tentatively re-starting some of their wells.
Parsley Energy Inc., a medium-size shale producer in Permian basin in Texas, on Thursday said it planned to “restore the vast majority of curtailments in early June” amounting to 26,000 barrels a day. And in the Bakken basin, producers have already increased output by about 35,000 barrels a day from the low point of mid-May, according to North Dakota official data.
On Tuesday, OPEC members were still wrangling over when to hold their next meeting. A proposal to bring it forward a few days to June 4 was floated on Saturday, but agreement on when to hold the virtual gathering was still elusive.Another sticking point in discussions is the issue of compliance — whether members are implementing the cuts they have already promised, according to delegates.
Russia, which was often a laggard in the past but has stuck to its pledges this time, is also pushing for any extension to be conditional on compliance. Iraq and Nigeria, who have repeatedly flouted OPEC commitments during the past three years, made less than half of their agreed cutbacks last month, a
$100 oil price by the end of the year?🤔
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