By Ese Awhotu with agency report
The Organisation of Petroleum Exporting Countries, OPEC, is breaking down into two camps after more than a year of unity, reason being differing views on oil prices.
MarketWatch the source of this source of this story reports that, on one side is Saudi Arabia, which wants oil prices at $70 a barrel or higher, and on the other is Iran, which wants them around $60.
According to the online medium, the split is driven by differing views over whether $70 a barrel sends U.S. shale companies into a production frenzy that could cause prices to crash. At stake is the Organization of the Petroleum Exporting Countries’ production limits, which are among factors helping the oil market’s months long recovery.
Iran wants OPEC to work to keep oil prices around $60 a barrel to contain shale producers, Oil Minister Bijan Zanganeh told The Wall Street Journal in a rare interview.
That is a little below Friday’s prices LCOK8, -1.21% of $65.49 a barrel for Brent crude, the international benchmark, and $62.04 in the U.S. CLJ8, -1.53%
“If the price jumps to around $70…it will motivate more production in shale oil in the United States,” Zanganeh said.
The report notes that Shale producers are more nimble than big OPEC producers, using techniques that allow them to increase or decrease production depending on the oil price.