Post by privateinvestors on Jun 5, 2016 14:40:17 GMT 4
Dear Oil & Energy Investor,
On Thursday morning, with OPEC's meeting in Vienna underway, rumor had it that Saudi Arabia and its closest allies in the cartel were going to propose a new production ceiling for the cartel.
The cartel hasn't had an output ceiling or target since December 2015, its last meeting, when it couldn't agree on one.
In any event, later on Thursday we saw how these rumors turned out when OPEC's Vienna meeting ended with no changes to policy at all.
The bottom line is this: OPEC is no longer in charge of oil markets, because of the amount of crude production that can come online as soon as prices inch higher.
And you can safely ignore the Saudi rhetoric from the Vienna meeting. Despite what they said, they don't care much for OPEC anymore.
The Saudi plan to partially privatize their state oil giant Saudi Aramco, and use the proceeds to invest in companies across the world, is specifically designed to reduce the kingdom's reliance on oil and oil revenue.