The time has come for the Organization of Petroleum Exporting Countries (OPEC) to start worrying.
That’s according to Vandana Hari, founder of Vanda Insights, who expressed her view in a television interview with Bloomberg.
“Now the time has come, clearly, that OPEC has to start worrying. It is starting to worry about the supply demand balance again swinging back to surplus next year,” Hari said in the interview.
“That’s why I think it’s quite likely that they will at least start talking about it at this weekend meeting. The decision of course will need to be taken when the full quorum of ministers meet in December,” Hari added.
In the interview, Hari highlighted that the “reinvented OPEC since 2017” has “very consistently” said that it’s going to have “a more hands on approach”.
“It’s going to do a constant balancing, re-balancing of the market, if you will, and we saw evidence of that very clearly in June this year when they stepped away … a little bit from their output restraint agreement of 2016 and said ‘ok, Venezuelan production is going down, Iran production might slump as well so we will put an extra one million barrels per day in the market’,” Hari told Bloomberg.
OPEC is scheduled to hold its 175th Ordinary Meeting on December 6 in Vienna, Austria. According to Vanda Insights’ website, Hari has more than two decades of experience providing intelligence on the global oil and gas markets to executives in the industry and related services, government officials and agencies, as well as wealth managers. Hari launched Vanda Insights in September 2016.
Earlier this month, the November OPEC Bulletin commentary piece stated that “there will no doubt be hard times to come in the oil industry,” listing geopolitical storms, disruptive weather events, speculation and transportation issues as examples of drivers.
The commentary piece added, however, that the platform for dialogue created through the group’s Declaration of Cooperation “can help calm stormy waters and provide the ship that is our industry safe passage”.
The Declaration of Cooperation was first signed in December 2016 between 24 OPEC and non-OPEC oil producing countries.