Saudis Rejected Calls to Cut Production in OPEC

Saudi Arabia was likely to reject the calls from fellow members of OPEC to cut oil production. As the leader of the group argued, it cannot deal by itself, with one of the worst gluts in oil in history.

OPEC was expected to keep its current policies in place, enforced by the oil minister of Saudi Arabia Ali al-Naimi and put into place last year, that were set up to defend market share by pumping volumes at record paces to drive its rivals, which have higher costs, out of the market.

However, while the Saudis were able to claim partial victory over the shale boom in the U.S., production from top rival of OPEC, Russia has kept surprising on its upside and its own group members such as Iran and Iraq are readying to increase per day barrel counts.

World stockpiles of oil were up to a record, according to data from International Energy Agency.

Nicolas Maduro the President of Venezuela said that his country, which is one of the traditional price hawks of OPEC, would push for an output cut of 5% at the meeting of the group. OPEC already is producing 1.7 million barrels a day above its current ceiling.

Iran has asked OPEC as well to respect the 30 million barrels per day ceiling, but added it was not seeking the permission to increase output as soon as the sanctions from the West against the country are lifted in 2016.

Other price hawks in OPEC like Algeria have called for cuts in production but as with previous are not volunteering to lower their outputs meaning the burden would be carried by just Saudi Arabia.

Naimi, while arriving in Vienna said he would be listening to the other members of the group, many of whom complained about the prices of oil that have dropped below a low of six year to about $44 per barrel.