Saudis cuts oil production to boost prices.
Russia takes advantage and increases output.
As world energy demand drops due to conservation and increasing availability of alternate energy from renewable sources, OPEC members start competing for production quota.
LONDON (AFP) - - Saudi Arabia sacrificed billions of dollars in revenues this year by cutting oil output to prop up the price of crude, only to see Russia snatch a bigger chunk of the market, analysts say.
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Now the Gulf kingdom, previously a vigilant enforcer of the cuts by the OPEC cartel that checked the sharp fall in oil prices last year, appears to be expanding its own oil flow again in exasperation.
"The cartel has lost a significant portion of market share in global crude production in the last year mostly to Russia," wrote Francisco Blanch, a commodities analyst at Bank of America Merrill Lynch, in a note.
With its production capacity rising but output held down by lower quotas, he estimated, "Saudi Arabia's 'missed oil revenues' are probably running at close to 100 billion dollars per annum, or almost 25 percent of GDP."
Saudi Arabia may be "taking too much weight on its shoulders," he suggested.
"Saudi Arabia citizens have taken up the largest share of the reduction in revenues" from the recent output cuts.
Now observers say the country's patience is running out, especially since other OPEC members, notably Iran, Venezuela and Angola, are accused of failing to comply with the agreed cuts.
Russia takes advantage and increases output.
As world energy demand drops due to conservation and increasing availability of alternate energy from renewable sources, OPEC members start competing for production quota.
LONDON (AFP) - - Saudi Arabia sacrificed billions of dollars in revenues this year by cutting oil output to prop up the price of crude, only to see Russia snatch a bigger chunk of the market, analysts say.
ADVERTISEMENT
Now the Gulf kingdom, previously a vigilant enforcer of the cuts by the OPEC cartel that checked the sharp fall in oil prices last year, appears to be expanding its own oil flow again in exasperation.
"The cartel has lost a significant portion of market share in global crude production in the last year mostly to Russia," wrote Francisco Blanch, a commodities analyst at Bank of America Merrill Lynch, in a note.
With its production capacity rising but output held down by lower quotas, he estimated, "Saudi Arabia's 'missed oil revenues' are probably running at close to 100 billion dollars per annum, or almost 25 percent of GDP."
Saudi Arabia may be "taking too much weight on its shoulders," he suggested.
"Saudi Arabia citizens have taken up the largest share of the reduction in revenues" from the recent output cuts.
Now observers say the country's patience is running out, especially since other OPEC members, notably Iran, Venezuela and Angola, are accused of failing to comply with the agreed cuts.
