The Organisation of Petroleum Exporting Countries is looking for a “fair” price for its crude, Saudi Arabia’s Foreign Minister, Prince Faisal bin Farhan said this week after a meeting with his counterpart from Russia, Sergey Lavrov.
“I would like to assure that we and Russia would like an oil price which is fair to consumers and to producers,” bin Farhan said, adding, “This is what OPEC+ looks to achieve and there is good coordination in this initiative and we continue in working to support what benefits the global economy.”
Lavrov, for his part, noted that the OPEC+ alliance was strong, and there was nothing that could, at this point, undermine the good working relationship between Russia and Saudi Arabia.
Lavrov also said the purpose of the OPEC+ agreement was to restore balance on global oil markets and reduce volatility, saying he hoped that the extended cartel would “find a way to coordinate our actions in such a way as balance the interests of both producers and consumers.”
Finding this balance might prove tricky, however. Most OPEC members would like higher prices—the higher, the better, including Saudi Arabia—while most consumers would prefer much lower prices.
India, for instance, has been particularly vocal in its dissatisfaction with OPEC+ cuts. One of the world’s biggest oil importers repeatedly asked the cartel to reconsider the cuts, most recently warning that rising oil prices would threaten its economic recovery from the pandemic.
Following this warning, India started looking for alternative suppliers to its regular oil partners from the Middle East who are pushing for higher prices.
“We have asked companies to aggressively look for diversification. We cannot be held hostage to the arbitrary decision of Middle East producers. When they wanted to stabilize the market we stood by them,” a government source told Reuters this week.
By Irina Slav for Oilprice.com
More Top Reads From Oilprice.com:
- How Oil Could Go To $100 Per Barrel
- Biden’s Policies Unlikely To Cause Crash In U.S. Oil Production
- Oil Prices Move Higher Despite Another Major Crude Build