OPEC’s Tuesday meeting left very little accomplished.
The 12 nations failed to reach an agreement on what to do regarding oil output when Venezuela and Iran held their stance against Saudi Arabia’s proposal to increase output by 1.5 million barrels a day.
The disagreement left OPEC to announce no change in output for the time being since no consensus could be reached.
Yet Saudi Arabia has something else in mind.
Despite OPEC’s overall decision to maintain output, Saudi Arabia has decided to increase their own output by a speculated 10 million barrels a day to keep up with the market’s needs.
This led to a 2.6% drop in prices for light, sweet crude oil delivery for July on the New York Mercantile Exchange.
Prices that had risen on Tuesday immediately following the OPEC meeting dropped below $100 a barrel to around $99.30, a relatively pleasing number.
Brent crude oil on ICE futures also declined about 1.2% to near $118.30 a barrel.
As far as evidence goes, Saudi Arabia plans to keep to their promise.
They showed desire to help the market in any way they can, trying to make up for Libya’s lack of production as a result of the riots and rebellions minimizing their output by drastic numbers.
Perhaps this can keep the numbers below $100 a barrel.
That’s all for now,