OPEC along with the friends had a meeting later this week in Vienna and the background is not so pretty.
The prices of the oil are at its lowest level since an year and there is a high probability that there will be flooding of oil in the year 2019 if the group is unable to reach to a new deal so as to cut the production.
However, there are chances of an agreement being possible. Saudi Arabia is pretty adamant that the burden of this must be shared among-st all rather than one or few bearing the load.
But the other countries in the group are arguing that since June the output boost by the kingdom is what that has created problems and therefore it is the responsibility of the kingdom to solve the problem by bearing the “brunt of the cuts.”
Now Saudi Arabia has to vacillate between rock and hard place.
From the perspective of economics, the basic requirement of Saudi Arabia is to make the production of oil decrease but that from the political front is not supportive as the country might not be able to afford this decrease in production.
Most of the people are unable to believe that the journalist of Saudi Arabia, Jamal Khashoggi was murdered in Istanbul which is the consulate of the country, without the knowledge as well as approval of Mohammed Bin Salman, the Crown Prince.
This has placed the leader of Saudi in a very weak position. As of now, Mohammed Bin Salman is being shielded only by the president of the United States who stated that case against the prince has not yet been proved beyond doubt.
The president, Donald Trump has also been shielding him as well as the country from the sanctions which could have been imposed upon along with the anti-trust act which is aimed at hobbling OPEC.
Source: Bloomberg, MSN