In an interview with Al Arabiya, Qamar Energy CEO Robin Mills explained how several factors are impacting the current oil market fundamentals.
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Saudi Energy Minister Prince Abdulaziz bin Salman’s latest comments on the dislocation of the “paper” financial market and the “real” physical oil market came in light of increased volatility in oil prices, which have oscillated wildly over the past two weeks between $105 and almost $90.
The minister also discussed the possibility and willingness of OPEC+ to cut oil production if necessary to realign the two markets to reflect what he sees as a tighter global oil market.
The comments come at a time when the EU is preparing a ban on Russian crude transported by sea which will come into force in December and when the G7 is considering capping Russian oil prices.
In addition, expectations that a new nuclear deal between Iran and the United States will soon materialize have markets guessing how big and how fast Iranian barrels will hit the market.
This all comes on top of growing fears of a global recession as central banks raise interest rates to combat decades-long highs in inflation.
All of these factors have combined to create ambiguity in oil markets. This highlights the importance of OPEC+ as the only transparent and stabilizing factor.
OPEC+ meets on September 5, and while analysts expect no change in production levels, work already appears to be underway to prepare to extend the OPEC+ pact through 2023 and into beyond, as revealed by Prince Abdulaziz.
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. Interview CEO Qamar Energy discusses factors having a impact on the fundamentals market oil