Tuesday, May 14, 2013

OPEC Meeting

OPEC will have an official meeting later this month, on the 31st in Vienna, Austria.  OPEC is keen on the possibilities of a Chinese and Eurozone recession affecting demand, as well as the rise in US production and the debate over the XL-Pipeline affecting supply.  Member nations Libya and Iraq are still expected to request quota increases, and Iran and UAE are expected to be the most opposed.

As far as prices?  There is not a whole lot of news about prices.  However, I remain agnostic.  Given the general language from the OPEC countries (notably Iraq, Iran and UAE), there does appear to be some squabbling going on that indicates production will go up in Iraq and Libya.

So for a country like Saudi Arabia, which is seen as holding the most control over prices because they can  make the largest reduction in volume, the supply and demand balance will have a big impact on government revenue.  So consider the production and consumption amongst some of these OPEC nations over the past several years.

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