OPEC President lamented the reactivity of US shale industry – RBC

Organization of petroleum exporting countries Secretary General (OPEC) Abdullah al-Badri Photo: AP

OPEC has never had to deal with the source of the oil, which is as fast as shale US industry can respond to higher oil prices, and to make up the deficit due to production cuts, said the head of the cartel

The American companies producing shale oil, can easily increase production and eliminate hydrocarbon deficit, if the oil price will rise because of production cuts by other countries. On this, as reported by Bloomberg, said the Organization of Petroleum Exporting Countries Secretary General (OPEC) Abdalla Salem El-Badri during a speech at the annual international oil and gas conference in Houston.

«I do not know how we will live with it “- complained al-Badri. “Any price increase immediately respond shale industry and will block all decline in production”, – he explained

According to him, OPEC has never had to deal with the oil source, which can so quickly respond to changing prices. and fill the missing volumes. This, added al-Badri, significantly complicates the possibility of a cartel to contain the fall in prices by reducing production.

On February 16, during the talks in Qatar, representatives of the Ministries of Energy of Russia, Qatar, Saudi Arabia and Venezuela have decided to freeze the oil at 11 of January. “Following the meeting, the four countries – Russia, Saudi Arabia, Qatar and Venezuela – are willing to freeze oil production at the level of January, when other manufacturers join this initiative,” – said the head of the Ministry of Energy Alexander Novak

The agreement refused. to join Iran talks in Tehran ended without announcement of the results. Later, sources have told Reuters that Iran has declared to first equalize the starting opportunities parties to the agreement.

Analysts at Goldman Sachs, Deutsche Bank and Barclays were skeptical about the ability to influence the market through these agreements. “Not only that, the talk shifted from production cuts only to freezing, the proposal still comes from oil producers, which in any case is not going to increase the volume of production (Russia, Venezuela, Saudi Arabia and Qatar),” – said the Deutsche Bank.

Barclays Bank believes that even if the agreement will be successful, the rise in oil prices, to which it can cause, will be limited. “OPEC is still faced with the dilemma between higher oil prices and market share, to achieve both goals, it is not able to”, – says the Barclays comments

22 fevrayal Bloomberg reported that the hedge funds. and other speculators have reduced the number of bets on the rising cost of oil. This fall was the highest over the past seven months.