As another summer driving season approaches with its expected increases in gas prices, market speculators are watching OPEC+ intently for signs of where the price of crude oil could go ahead of the cartel’s scheduled June 4 meeting.
Such speculators should proceed with extreme caution, however, if the words of one of Saudi Arabia’s most important rulers are to be taken at face value.
On Tuesday, oil minister Prince Abdulaziz bin Salman warned market speculators to “watch out” ahead of the June meeting lest they get burned again as they did in April. “Speculators, like in any market, there are there to stay. I keep advising that they will be ouching. They did ouch in April. I don’t have to show my cards, I’m not [a] poker player … but I would just tell them, watch out,” said the minister at the Qatar Economic Forum, according to NBC DFW 5.
Last month, OPEC+ cut production by a combined 1.6 million barrels per day, which some experts viewed as a move to keep oil prices from falling to a certain point.
OPEC+ officials have since denied that this is their goal, even as Russian President Vladimir Putin explicitly stated that Russian “actions, including those related to voluntary production cuts, are connected precisely with the need to maintain a certain price environment on world markets, in dialogue and contact with our partners in OPEC+,” as reported by Reuters.
The United States has accused OPEC+ of illegal price manipulation that hurts oil consumer countries.
However, some experts think OPEC+ is cutting production to counter a contracting economy caused by higher interest rates imposed by central banks, as reported by The Dallas Express.
Although tough on drivers looking to plan summer getaways, higher oil prices are a boon for parts of the economy in Texas. Texas has even surpassed Canada’s output, per a 2018 report by the American Enterprise Institute.
OPEC+ will meet on June 4.