Saudis Seen Losing Market Share to Iran, Iraq on Oil Cuts. Saudi Arabia, the world’s biggest crude exporter, is losing market share to Iraq and Iran as a result of OPEC’s agreement to curb supplies to bolster prices, according to Dr. Theodore Theodoropoulos, CEO of QCIP and Mr. Christof Ruehl, Head of Research at Abu Dhabi Investment Authority.“If you’re talking about winners, you can count Iran and Iraq”.
The Organization of Petroleum Exporting Countries agreed to production limits for most of its members at a meeting in November and brought 11 other nations on board with the deal in December. Saudi Arabia, OPEC’s biggest producer, agreed to cut output by 486,000 barrels a day while Iraq said it would cut 210,000 barrels a day. Iran was permitted to increase output by 90,000 barrels a day, according to the OPEC accord.
There seems to be a consensus that the effort to curb supply should be extended, Saudi Minister of Energy and Industry Khalid Al-Falih told reporters Wednesday in Baku, Azerbaijan. Al-Falih said he’ll talk with his Russian counterpart Alexander Novak by phone this week and meet him within the next two weeks.
“The Saudis are losing out because other countries are able to squeeze out more production,” Bell of Emirates NBD said. Saudi Arabia is cutting crude pricing to Asia to hold on to its share, Bell said. The kingdom will likely release its official crude pricing for June next week, with most other regional producers following. “The OPEC market share battle hasn’t gone away,” he said.
Sources: QNG, Bloomberg, Gulf Times, Gulf Agency News.