The world of crude oil is buzzing right now, as OPEC is currently meeting in Vienna, with a goal of reaching an agreement over production levels within the next 6 months. Oil prices dropped over 3 percent on Thursday as OPEC agreed to cut production. However, the cartel is waiting to decide on the actual size of reduction until after a discussion with Russia. This could delay the decision until Friday, when OPEC is set to meet with non-members.
As we approach the holidays, here are a few things oil and gas companies are juggling:
Since the start of November, the two-year bull-run in the energy sector is facing one of its biggest challenges. Within the oil market universe, there are growing concerns of a global economic slowdown and oil demand following suit as the continued price collapse, almost 15%, from its October highs.
With the Iran sanctions looming, international oil markets are looking for alternative crude suppliers. The United States and the European Union (EU) as well as many others, have initially turned to Saudi Arabia. However, there is uncertainty of the Saudi’s ability to fill in the production gaps given the recent turmoil over a murdered Saudi Arabian journalist. One source of additional crude production available is Russia, according to Igor Sechin, the Chief Executive of Russian oil major Rosneft.