Saudi minister warns of $50 oil as OPEC+ members flout production curbs

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Subscribe to enjoy similar stories. The Saudi oil minister has said that prices could drop to as low as $50 per barrel if so-called cheaters within OPEC+ don’t stick to agreed-upon production limits, according to delegates in the cartel.

The statements were interpreted by other producers as a veiled threat from the kingdom that it is willing to launch a price war to keep its market share if other countries don’t abide by the group’s agreements, they said. Key members of an alliance made of the Organization of the Petroleum Exporting Countries and its allies, together known as OPEC+, are set to discuss whether to ease production curbs in December at a scheduled online gathering Wednesday.

After Iran launched missiles at Israel on Tuesday, oil prices climbed after weeks of steady declines. Brent crude, the international benchmark, gained as much as 5% before settling at 2.4% higher at just under $70.

There are fears in the West that a wider war could choke oil exports from the Gulf that pass through the Strait of Hormuz, which borders Iran, and push prices higher. But geopolitical tensions have persisted for months without meaningful effect on oil prices, and the declines have been frustrating for Saudi officials in part because other cartel members have flouted plans to limit production for much of this year.

During a conference call last week, Prince Abdulaziz bin Salman, the oil minister of OPEC kingmaker Saudi Arabia, warned fellow producers prices could drop to $50 a barrel if they don’t comply with agreed production cuts, according to OPEC delegates who attended the call. They said he singled out Iraq, which overproduced by 400,000 barrels a day in August, according to data provider S&P Global Ratings, and