Bitumen price in Iraq
As you can easily guess, this article is about to talk about the bitumen price in Iraq.
Therefore, we have brought some pieces of news in this regard. Hope you find them useful.
For the second month in a row,
Saudi Arabia has refused to announce its crude oil prices on time for next
month, coinciding with the postponement of the OPEC Plus meeting. Saudi Aramco traditionally rates its oil production on the first five days of each month. However, with the start of the oil war with Russia and its aftermath,
the eyes of this Middle Eastern oil giant are waiting for the
OPEC Plus meeting and its outcome.
Bitumen price in Iraq and the world’s events
Generally speaking, the delay in announcing the bitumen price in Iraq could
also affect the oil prices of other Gulf states, as Riyadh’s allies in OPEC
usually look to the Aramco price list to determine their oil prices. Respectively, the OPEC Plus summit, in other words, the return of Riyadh and Moscow
to the negotiating table to reach an agreement and declare a ceasefire in this oil war. In fact, Russia’s dispute with Saudi Arabia at the March 6 summit was
as the death of OPEC Plus, marking the beginning of a new shock to
world oil markets.
Meanwhile, the President of the United States of America sought mediation
to prevent the fall of oil prices as much as possible. The announcement of
the immediate OPEC Plus meeting, scheduled for Monday, April 6,
was the result of US consultations aimed at rescuing shale oil producers;
Oil that will not be profitable to produce if such conditions continue. On April 2, the US president raised prices by 24% in a tweet expressing hope for a
10 million barrel cut in production. However, the oil market has a
long way to go to see stability.
Bitumen price in Iraq and the OPEC Plus
Needful to mention that postponing the OPEC Plus meeting means
continuing Saudi Arabia’s maximum production policy; A policy that,
with a significant reduction in market demand, will lead to price
reductions so that Riyadh will gain more market share in Asia and Europe than Moscow. Moreover, Saudi Arabia announced last month that it would
increase production from 9.7 million barrels per day to 12.3 million barrels per day. However, how does OPEC Plus play such a role in the market?
Why should Saudi Arabia, as OPEC’s largest oil exporter,
wait for such a meeting and agreement with Russia?
Bitumen price in Iraq and OPEC Plus; from birth to coma
The Organization of Petroleum Exporting Countries (OPEC) in December 2016, after experiencing two years of falling prices in world markets,
agreed with a group of non-OPEC producers to reduce production. Additionally, these non-member countries, along with OPEC, were able to regulate the
market following a review of oil production and supply in 2017. Joint
consultation and policy-making between 10 oil-producing countries,
including Russia, along with 13 OPEC members, is as OPEC Plus. In practice, before April 6 this year, OPEC Plus was a coalition led by Moscow and Riyadh to
regulate the market with their production and supply volumes;
for this reason, Moscow’s opposition to reducing production was
as the death or collapse of OPEC Plus.
It’s also good to know that the OPEC Plus has formed with the
intention of accompanying producers such as Russia, Mexico,
the Republic of Azerbaijan, Bahrain, Sudan, South Sudan, Malaysia and
Oman with the Organization of Petroleum Exporting Countries in
regulating the market. This coalition is not just to reduce production,
but perhaps the most accurate phrase is to determine a common market regulation policy; For example, in the middle of 2018, they decided it increase
the production ceiling to prevent oil prices from exceeding $75 so that
high prices do not negatively affect demand.
Oil prices and the bitumen price in Iraq
A look at the circumstances that led to the formation of OPEC Plus
shows a change in OPEC’s strategic policy. In addition, the oil cartel has
not sought to increase market share in recent years but has made price
control a priority. As a matter of fact, a coalition of OPEC and non-OPEC
members met four years ago at an Algerian summit for a joint policy, remembering the sweet taste of $110 oil and seeing oil prices fall below $30. This year, however, OPEC Plus leaders have pushed up prices by announcing
an increase in crude oil production, along with factors such as the outbreak
of the new Coronavirus and declining market demand. The increase in these
two major producers is while Iran and Venezuela are also
exempt from production reduction due to US sanctions.
Roughly speaking, market conditions and bizarre action by the two
main OPEC Plus producers have been so astonishing that 12 US
senators have sent a letter to the Crown Prince of Saudi Arabia asking him to
act as “agent and guarantor of market stability.” It is unlikely that 60 years
ago, the leaders of the founding members of OPEC could have imagined that
one day US senators would ask a member of the organization to reach
the so-called oil market.
To sum up…
In other words, the event that the world has witnessed in the past month is
not only the disruption of a coalition under the name of OPEC Plus by
Moscow but also Riyadh taking a path contrary to OPEC strategy. The result of the April 6 meeting was a demonstration by the Saudi court and the Kremlin
that national interests outweighed institutional and international interests; Moscow did not make a collective decision to make the most of the
opportunity to impose sanctions on Iranian oil, and Riyadh added to
its production to leave no room for US shale oil. As the final point,
the coalition of OPEC and non-OPEC, led by the Saudi court and
the Kremlin, was not stable and orderly.