Over $50

By Isaac Cohen*

The announcement last week to extend the agreement to cut oil production by Russia and Saudi Arabia, first and second world producers respectively, was enough to push crude prices over $50 per barrel. It also contributed to the price increase the fact that, last week, official data from the Energy Information Administration revealed falling storage levels in the United States.

The Saudi-Russian agreement to extend the production cuts for the next nine months, until March 2018, will have to be confirmed this week by the 13 members of the Organization of Petroleum Exporting Countries (OPEC) and by 11 additional non members, meeting in Vienna. This means that to influence prices, despite producing almost 40 percent of world oil, OPEC needs the support of several non members, among them Russia, the world’s biggest producer.

Additionally, now there is a ceiling on how high oil prices can go, because the production of shale oil in the United States has become more efficient and therefore profitable, at between $40-50 per barrel. According to oil historian Daniel Yergin, in an op-ed in The Wall Street Journal, next year the United States will reach “the highest level of oil production in its entire history,” estimated at more than 9 million barrels per day. Also, oil production in Canada and Brazil, the 7th and 10th biggest producers respectively, becomes profitable as well at $50 per barrel.

*International analyst and consultant. Commentator on economic and financial issues for CNN en Español TV and radio, UNIVISION, TELEMUNDO and other media. Former Director, UNECLAC Washington

About Ramón Jiménez

Ramón Jiménez, actual Managing Editor de MetroLatinoUSA. Periodista que cubre eventos de las comunidades latinas en Washington D.C., Maryland y Virginia. Graduado de la Escuela de Periodismo de la Universidad del Distrito de Columbia. Galardonado en numerosas ocasiones por parte de la Asociación Nacional de Publicaciones Hispanas (NAHP) y otras organizaciones comunitarias y deportivas de la región metropolitana de esta capital. También premiado en dos ocasiones como Mejor Periodista del Año por la cobertura de la comunidad salvadoreña; premios otorgados por la Oficina de Asuntos Latinos del Alcalde de Washington (OLA) y otras organizaciones. Ha sido miembro del jurado calificador en diferentes concursos literarios, de belleza y talento en la región metropolitana. Ha visitado zonas de desastre en Nicaragua, Honduras y El Salvador e invitado a esos países por organizaciones que asisten a personas de escasos recursos económicos. Antes trabajó en otros medios de prensa de Virginia y Washington, D.C., incluyendo reportajes para una agencia noticiosa mundial.

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