Oil prices are hard to fall! OPEC meeting is coming, the long-term view of the willingness to increase production is still insufficient
This should be obvious to everyone familiar with the fundamentals of economics, but some of those currently in power in Europe and the United States do not seem to realize this. Their reasoning seems to be that oil producers have a vested interest in selling oil when demand is high, and that demand will not be as strong in 20 years under climate change plans.
This is a valid line of reasoning, and the oil-producing countries themselves recognize this. It is this (at least in part) that has driven the UAE and Saudi Arabia to invest in increasing production capacity. The UAE has a total production target of 5 million barrels per day, while Saudi Arabia has a capacity target of 13 million barrels per day. This should be good news for oil-demanding importers, but that capacity will not come online this year, and those in Europe in particular are rushing to reduce their dependence on Russian oil by the end of the year. The obvious alternative to Russian oil will be oil from the Middle East, but that is easier said than done.
Moreover, shipping oil from Asia to Europe makes little strategic sense: unlike Asia, Europe is a declining oil market. In other words, Gulf oil producers have no real incentive to sell more oil to Europe. Nor do they have an incentive to join the West's condemnation of Russia.
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