Pressure is building on Saudi Arabia to rein in its oil output after a year of pumping full tilt, setting up the most contentious OPEC meeting in years.
A year ago, the Organization of the Petroleum Exporting Countries surprised markets with a Saudi-led strategy of keeping output high to win market share and squeeze presumably weaker rivals in the U.S. and elsewhere out of the market.
But with those rivals proving resilient and prices falling to new lows, members including Iran have decided the effort was a failure and are preparing to press Saudi Arabia directly to pull back on production at the group’s meeting this week.
Discontent is even building inside Saudi Arabia over the strategy. Still, the oil-rich kingdom isn’t likely to relent—in part because it is wary of rising Iranian output as sanctions are lifted. The result is likely to be a continued standoff that keeps the market glutted and prices weak.
This week, Iran is expected to demand that Saudi Arabia cut back from production levels of more than 10 million barrels a day
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