OPEC – Oil Market is Well Supplied despite Oil Price Worries

The secretary general of OPEC recently said that the oil markets are well supplied. The statement maintains the group’s view that crude inventory and production levels are sufficient, in spite of the high per barrel oil prices that worry consumer nations struggling with weak economic growth.

OPEC produces at least one-third of the oil worldwide. In the early parts of this month, the organization said that its production gained almost 260,000 barrels a day in the month of August in spite of the embargo of the European Union and United States on the exports of Iran.

No part of the world is experiencing an oil shortage and that is anticipated to go on, said Abdullah al-Badri of OPEC while visiting Leoben, Austria. What is obvious is that the market is sufficiently supplied at the moment. Badri added that the spare production capacity of OPEC remain at a reasonable level.

Meanwhile, the United States and other consumer countries are concerned about the high per barrel oil prices causing negative effects on their struggling economies. Along these lines, Saudi Arabia, the top producer of the OPEC, is aiming to lower current oil prices. The Kingdom further said that most of the other OPEC nations want the (Brent) crude price per barrel at about $100.

The current oil prices reflect the recent fall of over $3 per barrel due to Saudi Arabia’s statements, according to analysts. The crude price per barrel of Brent for November delivery shed $3.60 to $108.43 in the latter parts of London trading. While West Texas Intermediate crude prices for October delivery fell $3.03 to $92.26 per barrel.

By: Chris Termeer