World Bulletin / News Desk
The Organization of the Petroleum Exporting Countries (OPEC) and U.S. shale producers will continue “productive” meetings, the cartel’s Secretary General Mohammad Barkindo said Wednesday.
“OPEC has broken the ice in reaching out to shale producers in the U.S.,” Barkindo told reporters on the sidelines of the World Petroleum Congress.
“We sat with them and we had a very productive and very useful preliminary meeting with them," he said.
“We all agreed that we should continue these meetings,” he added.
The oil cartel and U.S. shale producers began dialogue earlier in March this year.
OPEC and the American shale oil industry were regarded as being in direct competition. The additional supply from the U.S. to an already over-saturated oil market has often been blamed for plummeting prices.
The oil cartel is composed of sovereign nation members, but shale oil producers are American private companies, making it harder for OPEC to have intergovernmental contact with the U.S. shale sector.
Barkindo maintained that OPEC and shale producers have begun to “understand” each other.
“At the end of the day we are all agreed that we belong to the same oil market. We also agreed that we share responsibility in this market,” he said.
He said that OPEC and the U.S. shale companies would “definitely” meet again at the end of the year.
“It is a working process,” he said.
When asked if there was any possibility for Russia and U.S. shale oil companies coming together, Barkindo replied, “I can't speak for Russia.”
Since the shale revolution through 2000s, U.S. producers reached a production level that took the country from a net importer to a net exporter. The oil glut, of which the U.S. shale boom in the U.S. has contributed to, reduced oil prices and the revenues of oil producing economies.
OPEC members led by Saudi Arabia and non-OPEC countries led by Russia took action and capped their oil production to support oil market prices. Market reaction was mixed, but not to such an extent that the decision takers expected support from U.S. shale producers who continued their production.
Furthermore, the latest accusation of Russian intervention in the U.S. elections further strained relations with Russia, which has a long history of tension since the Cold War era.
However, regional markets struggled as profit-takers moved in after a healthy week and traders were spooked by reports the man probing Donald Trump's links to Russia will also investigate his business dealings.
In initial deals in the eurozone, Frankfurt's DAX 30 slipped 0.2 percent to 12,424.80 points and the CAC 40 in Paris also slipped 0.2 percent to 5,188.92 points compared with the closing levels on Thursday.
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