What matters in this deal is not the production figures – which can be changed through monthly reviews – but the fact that the organization was able to reach consensus under difficult circumstances, said Bhushan Bahree, executive director. from IHS Markit, a research firm.
“The important thing is that they faced a problem and overcame it,” Bahree said.
Further testing, however, is likely to occur as subsequent meetings provide opportunities for negotiation. The dispute with the Emirates could be a harbinger of changes that could create rifts between the various members of the group, which includes OPEC as well as Russia and its allies. .
The environment in which OPEC has operated for a long time is changing. The organization’s calculation was that pursuing higher prices while limiting production was a smart strategy as there would always be a demand for the vast resources its members still have in the ground.
Climate change has turned this long-term perspective upside down. The deadly floods in Europe this week are just the latest weather catastrophe prompting lawmakers to demand tougher rules on greenhouse gas emissions. Some countries, which depend on fossil fuels as their main source of government revenue, may seek to turn their reserves into cash while they still can.
“This latest collapse of OPEC highlights important changes in the strategy for marketing oil that are starting to spread across the world oil zone,” said Jim Krane, a researcher at the Baker Institute at Rice University.
The United Arab Emirates, whose oil production is dominated by the Emirate of Abu Dhabi, has for some time been moving in a direction that could lead to divergences with the rest of OPEC.
Abu Dhabi is investing heavily in its national oil company, the Abu Dhabi National Oil Company, attracting international companies to explore and develop new resources and strengthen activities such as refining and trading in petroleum products.