Historical events sometimes may go unnoticed. In one such instance, world’s influential cartel of the past, OPEC has observed that crude price may not reach $100 once more.
OPEC’s just concluded meeting on Friday in Vienna has decided to continue with the present daily output target of 30 million barrels.
Over the last few years, the oil cartel led by the largest producer Saudi Arabia, was engaging in severe battle with new entrants- the technology driven US shell companies. In November last year, OPEC has attacked the shell by not to cut production and thus not to bring price rise.
Saudi has convinced other 11 members of the group that any increase in price will encourage Shell’s investment in new facilities.
But there was no symptom for any suffocation for shell in the era of low price. Rather the opposite happened. They raised the bar of technology.
Over the last few months, reports are that shell industry has adopted strong cost cutting technologies.
Now everybody is convinced that shell is not a rookie to be pinned down with price cutting methods.
The good news is thus coming out so convincingly for consumer republics and they can dream about not so pinching crude prices. Investment banker and ace forecaster, Goldman and Sach predicted last week that crude may settle at around $60 by 2020.