Major oil producers plan to cut production as falling crude oil price spurs fear of crash

The major oil producers met Sunday in Abu Dhabi to consider returning to a reduction in their production after the sharp fall in crude prices that revived fears of a 2014 crash. The price oil lost a fifth of its value in just one month after. beginning of October, reaching its highest level in four years, under the combined effect of factors related to the rise in supply and the fear of stagnant demand.

Brent crude fell below the $ 70 mark Friday for the first time since April, while the West New York Texas Intermediate (WTI) fell below $ 60 a barrel, its lowest level in nine months.

The United States increased their shale oil production, while Saudi Arabia, Russia and others increased their crude inventories despite signs of slowing demand. [19659002] The fall also comes at a time when the sanctions imposed by the United States on Iranian oil exports have had a more moderate impact than expected.

"Prices fell as crude supplies from major producers, such as Saudi Arabia, the United States, more than compensate for Fawad Razaqzada, Forex.com badyst, told AFP

"Iranian sanctions not being as severe as in the beginning, OPEC officials and non-OPEC producers could discuss the need to restore compliance at the weekend

The energy ministers of the major producers, Russia and Saudi Arabia, will join other OPEC officials and non-OPEC members for the meeting. joint ministerial follow-up. Committee, which oversees production levels.

The world's second and third largest crude oil producers – after their elimination by the United States thanks to shale oil – Russia and Saudi Arabia are at the heart of an alliance of successful producing nations to solidify oil prices after the 2014 crisis.

Thanks to significant production cuts in early 2017, they managed to push oil prices from less than $ 30 a barrel to over $ 85 a barrel the barrel in October, thus greatly improving

The producing countries, however, eased the production cuts in June, after signs of tense markets and high prices had allowed hundreds of thousands of extra barrels to enter the country. on the market.

Saudi Arabia has increased its production by about 9.9 million barrels per According to the Minister of Energy, Khalid al-Falih, [0609002] Kuwait, Iraq Russia and the United Arab Emirates also increased production in May to about 10.7 million barrels a day in October.

Cailin Birch, an badyst at the Economist Intelligence Unit, said a start of slowing demand for oil in China, the world's largest importer of crude oil.

"The recent decline in the price of oil reflects a combination of factors.On the one hand, signs of slowing demand for oil are beginning to appear, the GDP growth rate in China is starting to moderate" said Mr Birch to AFP.

The meeting, which will also be attended by the Petroleum Ministers of Kuwait, Venezuela and the host country, UAE, should not take a decision

The JMMC, a technical committee, should make important recommendations on production cuts at a key ministerial meeting in Vienna next month for OPEC producers and other producers.

Commerzbank, the second largest lender said Friday that oil producers had to act to prevent a free fall in prices.

"If they do not signal any intention to reverse the latest increase in production, oil prices are threatening to fall further," said the bank in a note