TCA Financial: The Organization of Petroleum Exporting Countries (OPEC), the world's most powerful oil producing group begins its latest meeting in Vienna against a backdrop of increasing tensions between its 13 members.
Each country has its own economic needs and while de facto leader Saudi Arabia prefers to cap production, several members including Venezuela have been very vocal about their desire to see any freeze include a country-specific quotas production.
“The OPEC ministers are always squabbling and we see no reason for that to change at this meeting,” said Colin Phipps, chief economist at Shenzhen, China-based broker dealer, TCA Financial.
OPEC ministers arriving at the organization's headquarters seemed to be at loggerheads over what the group’s next move should be. Some, like Kuwait and Qatar seem biased toward the Saudi Arabian way of thinking while others such as Algeria side with Iran’s reasoning that individual quotas be introduced.
Iran, whose flat refusal to consider a freeze or even attend the last meeting in Doha, Qatar, is expected to maintain its hardline as it tries to revive a domestic industry ravaged by years of economic sanctions.
“Iran has a point. Its economy was on the brink of ruin before the nuclear deal that saw sanctions lifted. Saudi Arabia’s agenda is clear – to preserve market share – but other members are not as revenue-rich as the kingdom with Venezuela being an example of the chasm that exists between OPEC haves and have-nots,” said Phipps.
TCA Financial says it expects little more than an agreement to hold another meeting coming out of Vienna this week.

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