Surging Oil Prices a Boost for Aramco IPO but Iran Says It's No Good for OPEC
Conditions supporting the prices are also wreaking havoc in the supertanker industry, according to experts. File Image / Pixabay
As predicted, Tuesday's market showing of Brent rising above $68 per barrel is reportedly causing both jubilation as well as fear within circles of the Organization of the Petroleum Exporting Countries (OPEC): on one hand, the price is proof that the cartel's persistent production cutbacks are having a positive effect on tightening the market, but on the other the gains will likely spur even more U.S. production.
An unnamed official from OPEC told Reuters, "We all are excited about the rally and want to see if it will be sustainable during the year, as it will certainly whet the appetite of shale producers."
But Bijan Namdar Zanganeh, oil minister for Iran, on Tuesday declared that "Members of the Organization of Petroleum Exporting Countries are not keen on increased Brent crude prices above $60 a barrel because of shale oil."
Some countries may welcome higher prices as a way to plug government deficits
It should be noted that the Islamic republic isn't required to cut its output under the OPEC agreement and pumped 3.8 million barrels per day last month.
The production cuts that caused crude to approach the $70 mark has registered at least one outright casualty: supertankers, whose earnings plunged by more than half in 2017 because the OPEC cuts "reduced the number of cargoes from the Middle East to Asia significantly at a time wh....