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Expectations that the price of a barrel of oil will exceed $100 next year EconomyBreakingRising PricesOil MarketProduction Reduction 2023-12-01 // 07:37 Shafaq News / The American network "CNBC" expected, on Friday, that oil prices would exceed $100 per barrel next year, against the backdrop of OPEC+ members' commitment to reducing production. The network stated in a report that oil prices are expected to rise in the new year after some OPEC+ oil producers voluntarily pledged to reduce production. The global oil alliance, OPEC+, which leads stability in the market, issued a statement yesterday, Thursday, that did not officially support the continuation of production cuts, but individual countries announced voluntary cuts totaling 2.2 million barrels per day for the first quarter of 2024. The cuts are led by the Kingdom of Saudi Arabia, which is the largest member of OPEC and the most important oil producer in the world, as Riyadh agreed to extend the voluntary production cut by one million barrels per day, which is the voluntary cut that the Kingdom has been making since last July, and will continue with it until the end of the quarter. 1st of 2024. Russia said it would reduce supplies by 300,000 barrels per day of crude and 200,000 barrels per day of petroleum products during the same period. Iraq reduces 223 thousand barrels per day, the United Arab Emirates 163 thousand barrels per day, Kuwait 135 thousand barrels per day, Kazakhstan 82 thousand barrels per day, Algeria 51 thousand barrels per day, and the Sultanate of Oman 42 thousand barrels per day. “Commitment is key,” said Bill Perkins, CEO and chief trader at Skylar, adding, “We must get compliance from other OPEC countries.” He continued, "When some countries say they will reduce production, the market does not trust them to the same extent." The CNBC report says that the way in which the production cuts were announced confused traders and raised doubts in the market, as member states issued separate statements regarding their voluntary cuts. But the report confirms that "if members adhere to the cuts they pledged, crude oil prices are expected to rise over the next year." “When the cuts end at the end of the first quarter, these removed barrels will only gradually return to the market, which should help keep the oil market thirsty in the future,” UBS strategist Giovanni Stanovo wrote in a note following the decision. The first half of 2024,” he said, adding that he expected prices to rise in the oil market, which suffers from a lack of supply. Likewise, Goldman Sachs expects prices to rise, adopting a wait-and-see approach regarding OPEC+ members’ commitment to the proposed cuts. Global benchmark Brent crude futures fell by 0.25% to $80.66 per barrel on Friday, while US West Texas Intermediate crude futures fell by 0.04% to $75.93 per barrel. https://shafaq.com/ar/اقتصـاد/توقعات-بتجاوز-سعر-برميل-النفط-100-دولار-العام-المقبل -
Here is an article that demonstrates what lost oil production costs are, and how disruption of oil production can affect a country and it's government's budget. Interesting ... Libya lost $7 billion to oil strikes, must find new buyers 12/07/2013 TRIPOLI (Reuters) - Libya has lost more than $7 billion and faces new competition from Algeria and Nigeria in oil markets due to strikes at oilfields and ports drying up exports, Oil Minister Abdelbari al-Arusi said on Saturday. A mix of militias, tribesmen and civil servants have seized most oil ports and fields to demand more political power or higher pay, throttling Libya's oil export lifeline. The OPEC producer is facing turmoil as Prime Minister Ali Zeidan's government struggles to control dozens of former militias which helped oust Muammar Gaddafi two years ago but which have refused to give up their arms. Arusi said Libya had lost 9 billion Libyan dinars ($7.29 billion) in oil revenues after output had fallen to 250,000 barrels a day from 1.4 million bpd in July. He did not say how much Libya is exporting, but his deputy told Reuters last week that up to 50 percent of output was being used to keep the 120,000 bpd Zawiya refinery running. "We are facing a big problem because oil from Algeria and oil from Nigeria has entered the Mediterranean (market)," Arusi told al-Naba television station. "We have started looking for new markets in east Asia to offset the loss." He said he hoped export ports would start work soon but did not repeat comments from Wednesday that terminals might reopen on Tuesday. Arusi said the government was having trouble drafting a 2014 budget due to the drop in production from 1.4 million bpd in July to 250,000 bpd now. "We have a problem now. How are we supposed to prepare the budget?" he asked, adding that initial planning had assumed output of around 1.3 million bpd. He said only the El-Feel field, offshore operations and fields belonging to state-owned Sirte Oil Co in central Libya were still producing oil. Arusi said the abrupt halt in production had also damaged pipelines and other oil facilities, while some oil staff were in bad shape psychologically due to the strikes. "We are talking here about many cases, not just one" he said. OUTAGES He said the electricity supply would improve within hours after members of the Amazigh, or Berber, minority had ended a blockade of a gas pipeline feeding a power plant in western Libya which they had staged to demand more political rights. However, outages again hit central parts of the capital Tripoli on Saturday. Zeidan has failed to end strikes disrupting oil and gas supplies which started in earnest in the summer. One difficulty is that protesters are not a unified group, but range from a regional autonomy movement in the east, civil servants seeking pay, and minorities like the Berbers who want their language recognised. Those demands are hard to meet for a prime minister weakened by political infighting. Western powers worry the North African country will slide into instability with militias calling the shots in the streets while the government struggles to keep the budget running to pay civil servants and ease social tensions. ($1 = 1.2342 Libyan dinars) (Reporting by Ulf Laessing and Feras Bosalum; Editing by Alistair Lyon) Source: http://finance.yahoo.com/news/libya-lost-7-billion-oil-190354912.html
