OPEC Battles US Shale To Jostle For Crude Market Share

摘要

OPEC and allies rolled over this week their production cuts into March 2020,signaling that the oil market is still oversupplied and demand growth looks weaker at least for the rest of 2019,says an analyst 6th July.However,crude actually gained in the following week albeit most dismissed it as a temporary phase.OPEC’s tactic to draw down excess inventories,if successful,could lead to higher oil prices,which cartel members need to balance their budgets,most of which are overly reliant on oil exports.Meanwhile,higher oil prices are inadvertently helping U.S.shale production to continue growing,offsetting much of the barrels that OPEC is withholding from the market.It looks like the cartel aims for higher oil prices now and will think of regaining market share later.Question is will that plan work? Currently,OPEC and its Russia-led non-OPEC partners in the production cut deal focus on reducing inventories and boosting prices,even if this means ceding market share and having OPEC’s share of global oil production drop to below 30 percent for the first time since 1991,according to Bloomberg News estimates.