Organization of Petroleum Exporting Countries and allies (OPEC+) trimmed its forecast on global oil demand to average 96.05 million barrel per day (bpd), or down 110,000 bpd from the initial forecast, caused the impact of extended lockdowns - Photo: Special

JAKARTA (TheInsiderStories) – Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC member will gathered in Vienna, Switzerland starting tomorrow (12/06). The decision from this meeting is crucial for the oil and gas market.

Some countries, like Iran has pushed the organization to cut the group production of around 1.4 million barrels oil per day (BOPD). OPEC needs a unanimous vote to pass the decisions.

If failure, said Iran’ OPEC Governor Hossein Kazempour Ardebilione, would send oil prices plunging to US$40 a barrel. Saudi Arabia’s minister Khalid al-Falih even said that OPEC+ needs to figure out what the group to be done and by how much volume.

Oil prices have plunged by around 30 percent from early October as the market started to fear an oversupply is building up again, due to record high production in Saudi Arabia and Russia, and an all-time high oil output in the United States, coupled with fears of slowing economic and oil demand growth.

While, before the meeting Qatar giving notice of its intention to withdraw from its membership of OPEC, with effect from Jan. 1, 2019.  In the past three years, OPEC has seen Gabon (2016) rejoin the Organization and welcomed new members, Equatorial Guinea (2017) and the Republic of the Congo (2018).

The King Salman’ country tendency is to cut aggressively and would unilaterally lower exports starting this month. Even though Russian President Vladimir Putin said only wants to cut output by 150,000 BOPD, which would mean more heavy lifting by Saudi Arabia to balance the market.

Furthermore, President Donald Trump administration are eager to tighten the screws on Iran, as the country was in the midst of preparing to issue waivers for eight countries importing oil from Iran. The result could be much more Iranian supply knocked offline.

Previously, OPEC Secretary General, His Excellency Mohammad Sanusi Barkindo stated, the organization remains fully committed to achieving and sustaining balance and stability in the market.

Followed the OPEC+ planned to cut its production and reduction in Canadian output make oil prices rose by more than one percent on Tuesday (12/04). US West Texas Intermediate (WTI) crude futures were at $53.53 per barrel, up 1.1 per cent from the last close and Brent crude oil futures were also jumped 1.1 percent, at $62.39 per barrel.