Doubts in the market in the lead-up to the OPEC summit

Doubts in the market in the lead-up to the OPEC summit

Emilio Fabio Torsello
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Oil stock volatility persists as Russia gets ready to launch a new Arctic icebreaker

The OPEC meeting tomorrow is looking more like a poker table than anything else. Russia has declared itself willing not to cut its output, but to freeze it at current, record-breaking levels. Saudi Arabia may be working on an exit strategy in case the deal fails, while countries like Iran and Iraq are showing themselves to be far more skeptical about a possible agreement than weeks ago. In these volatile circumstances, reports travel and are contradicted one after the other in a matter of hours. The price of oil has had a correspondingly turbulent few days. Everything is riding on the outcome of tomorrow’s meeting in Vienna.
In the meantime, routine business goes on, with announcements like the recent one by Gazprom that it is testing a new vessel to support Arctic oil operations: an icebreaker that can operate at as low as -22 degrees Celsius below zero. The Russian operations will be held on the Yamal Peninsula (whose name in Russian means "the end of the world"), which is also home to the Bovanenkovo gas field, one of the region’s largest.
According to some leaks to the international press, Shell is planning to sell off its assets in Iraq. Following its acquisition of BG Group in February, the Dutch company is seeking to slim down its oil & gas portfolio. Partly due to falling revenue, Shell is now focusing on highly profitable areas like Brazil and the Gulf of Mexico.