Saudi Arabia, Russia, Qatar, Venezuela Agree to Freeze Oil Output
by: Summer Said and Benoit Faucon
Feb 17, 2016
Click here to view the full article on WSJ.com
by: Summer Said and Benoit Faucon
Feb 17, 2016
Click here to view the full article on WSJ.com
TOPICS: Cartels, Oil Markets
SUMMARY: Saudi Arabia and Russia, the world's two largest crude-oil exporters, said Tuesday they would halt production increases as long as other major producers followed suit, but prices fell anyway as investors looked for more concrete action to reduce the global glut of petroleum.
CLASSROOM APPLICATION: Students can evaluate the recent commitment and strategy by Saudi Arabia, Russia, Qatar, Kuwait, and Venezuela to cap oil production. The commitment is contingent on other OPEC members, notably Iran and Iraq, following suit. Involved in the evaluation is the reasons that Iran and Iraq have for increasing oil production.
QUESTIONS:
1. (Introductory) Why are Saudi and Arabia and Russia pushing OPEC members to halt increases in oil production?
2. (Advanced) Why have Iran and Iraq recently increased oil production? Are the two countries likely to halt increasing oil production?
3. (Advanced) What is Saudi Arabia's traditional role in OPEC? What was Saudi Arabia's rationale for abandoning this role in the recent past?
4. (Introductory) Why did the U.S. producers in the past year cut back on oil production?
1. (Introductory) Why are Saudi and Arabia and Russia pushing OPEC members to halt increases in oil production?
2. (Advanced) Why have Iran and Iraq recently increased oil production? Are the two countries likely to halt increasing oil production?
3. (Advanced) What is Saudi Arabia's traditional role in OPEC? What was Saudi Arabia's rationale for abandoning this role in the recent past?
4. (Introductory) Why did the U.S. producers in the past year cut back on oil production?
Reviewed By: James Dearden, Lehigh University
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