Saudi Arabia plans to increase oil production next month on more than 2 million barrels a day, hoping to increase it much above 10 million barrels a day, aggressively reacting to the collapse of their Alliance OPEC + Russia. How sources say Bloomberg< / span>, the market is regarded as a Declaration of a trade war.
the world's Largest oil exporter on Saturday started a price war by reducing prices on its oil to foreign markets at least 20 years, offering unprecedented discounts to buyers in Asia, Europe and the USA to encourage processors to buy Saudi oil at the expense of other suppliers.
"We probably in the next quarter will see the lowest prices on oil over the last 20 years", — said the Agency oil analyst at IHS, Markit Ltd. Roger Couch, implying that the price could fall below $ 20 per barrel. During a price war in December 1998, the price of Brent crude oil fell to 9.55 per barrel.
At the same time, Saudi Arabia has privately said some market participants that could increase production, if necessary, even to a record level of 12 million barrels a day, according to people familiar with the talks who asked not to reveal their name to protect a commercial relationship. Given the fact that the outbreak of coronavirus reduced demand, the opening of these valves would lead to chaos in the oil market.
Saudi strategy of shock and fear could be an attempt as quickly as possible to impose on Russia and other producers maximum pain in an attempt to bring them back to the negotiating table, and then quickly reverse the surge of production and begin to cut production, if a deal is reached sums Bloomberg< / span>.