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Saudi Arabia Will Halt Oil Production Increases Only If Iran Follows Suit

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Saudi Arabia Will Halt Oil Production Increases Only If Iran Follows Suit

Crude oil traded lower on Friday as the prospect of a freeze in output among major global producers turned grim.

According to Bloomberg, Saudi Arabia pledged to freeze its oil output, but under a major condition – Iran and other major producers must promise to follow suit.

OPEC and non-OPEC member nations are set to gather for a meeting on April 17 to discuss a potential freeze. Iran has made its intentions clear that it wants to increase production to regain lost market share following an international sanction.

Related Link: The "Key Concern" For Global Oil: Saudi Arabia

Saudi Arabia is "fighting for its very existence" against Iran and oil is the "only real weapon it has," Imperial Capital's oil strategy analyst Bob Christensen argued back in September of last year.

The analyst's commentary appears to still hold merit, perhaps now more so than ever.

"If all countries agree to freeze production, we're ready," Saudi Arabia's deputy crown prince Mohammed bin Salman said in an interview with Bloomberg. "If there is anyone that decides to raise their production, then we will not reject any opportunity that knocks on our door."

Image Credit: Public Domain

 

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