Like so many in the past, the latest deal by the world’s major oil producing countries to reduce supply and boost prices relies on persuading the cheats to adhere to the output cuts they’ve agreed to. I don’t hold out much hope that they will change their behavior and that will leave Saudi Arabia with a choice between two bad options — continue to bear a disproportionate share of the burden, or open the taps to teach them a lesson.
Saudi Arabia’s new oil minister Prince Abdulaziz Bin Salman brought a quasi-religious language to his attempt to bolster a new output deal ahead of Friday’s OPEC+ gathering in Vienna.
“Like religion, if you are a believer you have to practice. Without practice you are an unbeliever.”
“I do not assume that anyone here in the room is an unbeliever, but I would reiterate to our friends that further commitment and further conformity would allow us all to benefit.”
That message was very clearly directed at Iraq and Nigeria — the members who have so far failed to meet their obligations under the existing deal — although he stopped short of naming them.
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