Saudi, Russia leave world guessing after OPEC meeting

Saudi, Russia leave world guessing after OPEC meeting

Although Russia, the largest producer in the wider group known as OPEC+, agreed to a cut in principle, the eventual size of their contribution remains undefined and will be key to putting together the final deal.

"We have to get the non-OPEC countries on board", Saudi Energy Minister Khalid al-Falih told reporters before the OPEC meeting started.

"If Mr. Hook has come to Vienna to apply for United States membership in OPEC, and this is the reason why he meets OPEC members, the request can be reviewed", Zangeneh told Shana news outlet.

Hittle added that Wood Mackenzie's short-term outlook projects key OPEC producers - Saudi Arabia, United Arab Emirates and Kuwait - together with Russian Federation and Oman, will push through a moderate reduction in output in place through 2019.

He tweeted Wednesday that "Hopefully OPEC will be keeping oil flows as is, not restricted".

"Trump is making America great again", said Joe McMonigle, an oil analyst at Hedgeye Risk Management LLC and a former senior official at the U.S. Energy Department.

Saudi Arabia is equally prepared for a deal or no-deal situation, Al-Falih said.

"A million (barrels cut) would be ideal", Al-Falih said.

The oil price has been hammered by concerns that supply will outstrip demand next year, weakness in global markets and technical trading that has extended the selling.

During Thursday's meeting, OPEC leaders are expected to discuss how to stabilize crude oil production after US prices plunged by 22-percent in November - making it the worst month since the financial crisis in 2008.

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Nonetheless, Saudi Arabia is in a delicate position, in the wake of the murder of opposition journalist Jamal Khashoggi.

OPEC meets on Thursday in Vienna, followed by talks with allies such as Russian Federation on Friday.

However, analysts at ING told AFP news agency that the U.S. administration could possibly use the murder of journalist Jamal Khashoggi as leverage.

Saudi Arabia has indicated it wants the Organization of the Petroleum Exporting Countries and its allies to cut output by at least 1.3 million barrels per day, or 1.3 percent of global production.

Similarly, Russia's crude oil production increased to 11.44 million barrels per day (mbd) during the third quarter ended September as compared to 10.95 mbd recorded in the corresponding quarter a year ago.

"We must be excluded from any decision to cut production as long as illegal USA sanctions are not lifted", Iran's Oil Minister Bijan Namdar Zanganeh said on Wednesday evening as he arrived in Vienna.

"While the large crude oil inventory drop was notable, the surge in exports of crude oil to over 3 million barrels per day was remarkable", said John Kilduff, partner at energy hedge fund Again Capital LLC in NY.

Zanganeh said the estimated surplus now on the market amounted to 1.3-2.4 million barrels per day.

OPEC is also riven by internal conflict, especially between regional rivals Saudi Arabia and Iran. Saudi Arabia is the de facto leader of OPEC so its opinion goes a long way, however, due to the critical nature of this decision, it is likely to wait for Russia's opinion which may come later in the day.

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