Markets need not worry about tumbling oil prices because everything will sort itself out, the secretary general for the Organization of Petroleum Exporting Countries implored Monday at a conference in Abu Dhabi.
“Please do not panic, things will fix itself,” Abdullah al-Badri said, according to Reuters.
The oil cartel has been in the spotlight as oil prices have fallen to their lowest levels in years. Brent crude, an international index, began the day at $83.39.
Markets sensed a bit of a rebound early Monday. Prices rose in early trading because China’s export growth surpassed analysts’ expectations, according to MarketWatch.
Still, the focus is on whether OPEC, led by Saudi Arabia, will cut production to raise prices. So far, it’s shown it’s keen on keeping its spigot flowing to preserve market share against competition from the United States. That has created some strain for U.S. shale energy producers, as it’s shrunk the profit margins on those expensive wells, though most operations can tolerate the lower prices.
U.S. energy production — led by the shale boom that has pushed the nation, at 8.7 million barrels per day, to the world’s second-largest oil producer behind Saudi Arabia — combined with unexpected gains from Libya, more fuel-efficient vehicles and lagging global demand all have suppressed prices.
