OPEC — the acronym is well known to any literate person. It is interpreted as follows: the Organization of countries — exporters of oil (eng. The Organization of Petroleum Exporting Countries; OPEC abbreviated). It is an international intergovernmental organization created by oil producing countries to control production quotas for oil. Often regarded as a cartel.
Members of OPEC, included 14 countries: Algeria, Angola, Venezuela, Gabon, Iran, Iraq, Congo, Kuwait, Qatar (January 2019 left the Alliance), Libya, United Arab Emirates, Nigeria, Saudi Arabia, Equatorial Guinea and Ecuador. The headquarters is located in Vienna. The Secretary-General (from 1 August 2016) Mohammed Barkindo.
Date of Foundation — September 1960. Has been operational since January 1961. However, in the early years were known to a narrow circle of specialists, since on the world market of “black gold” was in command of the oil cartel called “seven sisters” (American and English companies). OPEC became world-famous in 1973 when the energy crisis broke out, which was reflected in the fact that within a few months the price of “black gold” on the world market has quadrupled.
All the politicians and experts almost with one voice said that it is the result of the actions of OPEC. And since almost any price fluctuations in the global oil market associated with the actions of OPEC or its individual members.
Our country (first the USSR, then Russian Federation) has always been a major exporter of “black gold”. Since 1998, became an observer in this organization, but membership abstained. At the end of 2016, an agreement was concluded between the Russian Federation and OPEC on cooperation in the regulation of prices for “black gold”, which became effective on January 1, 2017, the Agreement sets a limit of production for Russia, but it was limited in time (with the possibility of extension and revision of conditions of cooperation). The new configuration has received the name of OPEC+. The signing of the agreement, our country has been dictated by the fact that we, as a leading exporter of oil, can improve the efficiency of their exports by increasing oil prices and replenish our foreign exchange a jug. Since then, the agreement OPEC+ several times prolongirovanne (with some adjustments of quota). The last agreement is valid for the first half of 2019.
During the whole time of the agreement of Russia with OPEC Russian media (with rare exceptions) have presented it as highly advantageous to our country the deal. Supposedly, thanks to OPEC+ Russian Federation was able to gain additional billions and even tens of billions of dollars. And besides, to preserve the reserves of “black gold” in the bowels. Better to export less and more expensive, bigger, and cheaper — this is the simple logic of the Russian supporters OPEC+. Even calls that have cooperation with OPEC to move to a membership in said organization and, together with Saudi Arabia to begin to fully command the world market.
The voices of certain enemies OPEC+ or a doubter was not heard. And they were. An alternative point of view on OPEC+ sounded quite loud this year.
Feb 11, news Agency Neftegaz.RU. published interesting news. It turns out that at the end of last year, the head of Rosneft Igor Sechin sent to Russian President Vladimir Putin a letter with a request to prevent the extension of the agreement of Russia with OPEC. He called the deal to reduce oil production by OPEC strategic threat to Russia, believing that the main beneficiary of OPEC+ be USA.
As arguments justifying the position of the head of Rosneft, he cites the following facts and figures:
— the share of Russian oil on the world market falls. In 1990, it stood at 16,3%, and now it dropped to 12%;
— since 2007, oil production in Russia increased by only 10%, while in the U.S., Brazil and Iraq for 87%, 50% and 111%, respectively;
importers are switching from Russian oil to other varieties, rebuild the supply chain.
In short, the Russian oil company lost its position in the world market, and the deal with OPEC only accelerated this process. OPEC+ actually creates opportunities for American companies to seize the share of the world market of oil, which Russia voluntarily inferior, artificially reducing the production and export of “black gold”. Information Agency Neftegaz.RU. reports that the direct recommendation not to renew the agreement with OPEC in the letter was not, but the whole logic of the letter was brought exactly to the same conclusion. However, the OPEC agreement was extended for another six months.
The “leak” stirred the audience. The press-Secretary of Rosneft (M. Leontiev) and the Russian President (Dmitry Peskov), which asked questions in connection with the revelations of Igor Sechin, declined to comment. It turned out that before the letter to Putin, Sechin and his team expressed concerns about the possible strengthening of US positions in the world market of “black gold”. Especially in connection with the shale revolution that began in the New world. The excessive increase in oil prices has created favorable conditions for shale oil, which at more reasonable prices would be uncompetitive.
In hindsight, the experts drew attention to the fact that the agreement of Russia with OPEC was signed in December 2016, i.e. a month after winning the presidential election Donald trump. He’s still in the campaign period said that he came to the White house, will want to increase production “black gold”. And the creation of OPEC+ exactly contributed to the plans trump. Some conspiracy theorists even claim that the agreement with Russia was facilitated by Saudi Arabia is a reliable ally of Washington. Supposedly, Riyadh promised Moscow that they say, on a parity basis will reign and rule in OPEC.
In June of this year, the negotiations of Moscow with OPEC (in fact — with Riyadh) on the new six-month agreement has entered its final phase. Apparently, Igor Sechin felt his arguments from the December letter did not work and he decided to resort to another means to prevent the deal. The press-Secretary of Rosneft was given carte Blanche to open scoring arguments against OPEC+.
In the air of “Vesti FM” a week ago, Mikhail Leontiev said bluntly that OPEC+ in geostrategic terms is “giving the markets and the voluntary assignment of full control over the oil markets to the United States.” “So it turns out that the entire political, geopolitical opportunism, the idea of which to give and something to receive, is now superimposed on the apologetics of the agreement OPEC+, which in geo-economic, geo-strategic terms is the surrender of the markets”, — said the representative of the state-owned companies.
Moreover, the press-Secretary of Rosneft made a sensational statement: “OPEC and OPEC+, supposedly, determine the level of oil prices, although they do not define. Exactly. Define Americans, removing from the market the volume that they want. If they do not have enough volume, they will impose sanctions against a country or a war suit. When are you gonna do? When it is not enough efforts of OPEC+”, — said the press-Secretary of “Rosneft”.
Indeed, if we look at Washington’s sanctions against Iran, blocking 90% of the oil exports of this country, we’d have to agree with the hard thesis Mikhail Leontiev. The main tool of management of the market be no quota under OPEC (or OPEC+), and economic sanctions by Washington.
It is known that for continued cooperation with OPEC is the Minister of energy Alexander Novak. Advocating for OPEC+ people, according to Leontiev, “working objectively or subjectively in the interest of those who imposes sanctions, those who puts pressure on Russia”. This is clearly a stone “Rosneft”, thrown at the Minister.
The oil plans of America truly Napoleonic. They intend to increase production and export of “black gold” and next. On a monthly basis, it already produces more oil than Russia and Saudi Arabia. Expected production growth is clearly overlap with the production cuts within OPEC and OPEC+. So, sanctions will be imposed against other countries. And who knows, maybe even against Russia and Saudi Arabia? Some increased inflow of petrodollars to the Russian Treasury as a result of participation of our country in OPEC+ in the future may result in serious losses. Leontyev also said about it in the broadcast on “Vesti FM”: “This is the same logic, veiled by a magnificent Fig leaf of the alleged replenishment of the budget. Well, the graphics view. Before we could say that all the oil that is removed from the market, OPEC, that is, Russia and Saudi Arabia, is replaced by American. Now it is not. Now more American production of oil. Why have the tankers to ignite a lighter in the Bay, to tickle the market?”.
Against the extension of the agreement with the OPEC are other Russian oil companies. They say that, they say, Russia has already opened new fields of “black gold”. Representatives of the Russian oil business say: “why do we need to increase the resource base if OPEC+ dictates the decline in production?”
However, the arguments of “Rosneft” and other oil companies apparently did not affect the position of the head of the Ministry of energy of the Russian Federation Mr. Novak. Finally the decision of OPEC+ we learn at the beginning of next month: 1-2 July in Vienna will be the meeting of OPEC member countries and Russia and decide on the extension of the agreement.
However, I fear that the issue has been resolved. 29 June on the sidelines of the G-20 summit in Osaka held a meeting of Vladimir Putin with the crown Prince of Saudi Arabia. The President of the Russian Federation on a press-conferences, answering a question about the meeting, said: “with regard to today’s meeting with the crown Prince — Yes, indeed we discussed the possibility of extending our agreements with OPEC over production cuts. I want to inform you — it’s probably for the market certain matters that we have agreed. We will extend our agreements, in any case, we will support the renewal of the agreements, both Russia and Saudi Arabia.”
Well, during the existence of the Russian Federation we passed the position on many markets. Remains to pass on the market of “black gold”.
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