Saudi Arabia May Urge OPEC to Hold Quotas, CGES Says

(Bloomberg) — Saudi Arabia, the world’s biggest oil producer, may lobby OPEC to maintain output quotas at its March 5 meeting while trimming its own production to curb global supply, the Centre for Global Energy Studies said.

“OPEC is likely to desist from making any output cuts until the second half of the year,” the London-based center, known as CGES, said in a report e-mailed today. “Saudi Arabia may insist on keeping quotas the same while varying its own output in pursuit of high prices.”


The Organization of Petroleum Exporting Countries, which produces more than 40 percent of the world’s oil, will “hesitate” to adopt the supply cut suggested yesterday by its president, Algerian Oil Minister Chakib Khelil, after prices rose to a record above $101 a barrel last week, CGES said.

Saudi Arabia, which holds sway over the group as its largest member, is reducing the discounts it offers customers to “choke off” demand and using this approach “will continue to act quietly to restrict stock building,” according to the report.

Bloomberg