Crude Lower on Concerns Over OPEC Rift
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Crude is sharply lower in early going Friday, reversing earlier gains as speculators weigh the impact of a rift in OPEC opinion which was exposed during the latest meeting in Vienna on Wednesday.
Prices had been moving higher since the meeting as the group shocked the market after not being able to reach a consensus on raising output in light of the tension and pro-democracy movement witnessed in the region.
While the "worst meeting ever" had initially been viewed by market participates as bullish for oil prices, the market may now be considering what an OPEC-free world would look like. Some are suggesting if the cartel can't be held together, it could, over the long-run, be negative for prices.
Speculators are keenly watching the moves of the most important OPEC country Saudi Arabia, which said it would move to unilaterally increase production. A Saudi paper reported Friday the country is looking to raise its output to 10 million barrels per day.
At the recent meeting, Saudi Arabia, Kuwait, Qatar and the United Arab Emirates sought a 1.5 million barrel-per-day rise in output. However, an accord could not be reached due to opposition by Libya, Angola, Ecuador, Algeria, Iran and Venezuela.
May production from OPEC was reported at 26.32 million per day, up from the 26.17 million barrels in April. Saudi Arabia's output was 8.86 million barrels in May, up from 8.8 million barrels in April.
Light, Sweet crude for July delivery is down $1.39 to $100.54 per barrel this morning.
Prices had been moving higher since the meeting as the group shocked the market after not being able to reach a consensus on raising output in light of the tension and pro-democracy movement witnessed in the region.
While the "worst meeting ever" had initially been viewed by market participates as bullish for oil prices, the market may now be considering what an OPEC-free world would look like. Some are suggesting if the cartel can't be held together, it could, over the long-run, be negative for prices.
Speculators are keenly watching the moves of the most important OPEC country Saudi Arabia, which said it would move to unilaterally increase production. A Saudi paper reported Friday the country is looking to raise its output to 10 million barrels per day.
At the recent meeting, Saudi Arabia, Kuwait, Qatar and the United Arab Emirates sought a 1.5 million barrel-per-day rise in output. However, an accord could not be reached due to opposition by Libya, Angola, Ecuador, Algeria, Iran and Venezuela.
May production from OPEC was reported at 26.32 million per day, up from the 26.17 million barrels in April. Saudi Arabia's output was 8.86 million barrels in May, up from 8.8 million barrels in April.
Light, Sweet crude for July delivery is down $1.39 to $100.54 per barrel this morning.
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