Saudi Arabia is threatening to collapse oil prices because the OPEC + countries failed to agree with Russia to reduce oil production.
According to Bloomberg, Saudi Arabia’s oil company, Saudi Aramco, has already lowered the price of its oil to the lowest level in the last 20 years. Thus, the country is trying to take customers from Europe, Asia, and the United States from Russia.
It is reported that prices were reduced by $6-8 per barrel in all regions of Saudi Arabia. In addition, Saudi Arabia intends to increase production by more than 2 million barrels per day.
It is worth noting that the state’s plans for oil production and its price became known within a few hours after the failure of the OPEC + negotiations with the Russian Federation regarding the large-scale reduction in oil production since the 2008 crisis.
Now the price of high-quality oil from Saudi Arabia has become lower by $10.25. As for Russian oil, it is sold for $ 2 cheaper than raw materials of the reference brand.
“In the oil market, this is the equivalent of declaring war,” the source said.
In turn, oil analyst at IHS Markit Ltd. Roger Diwan said that in the next quarter, we might see the lowest oil prices in the last 20 years, below $ 20 per barrel.