“Not many countries are going to deliver” even if they promise supply curbs, al-Naimi said at the IHS CERAWeek conference in Houston Tuesday. An accord last week to freeze the oil production of Saudi Arabia, Russia, Qatar and Venezuela at January levels is “not like cutting production, that’s not going to happen.”
Instead, high-cost producers will have to “lower costs, borrow or liquidate” to cope with the slump in oil prices, al-Naimi said, adding that he doesn’t know when the current rout will end. This is a “more efficient” way for the market to rebalance than cuts by low-cost producers like Saudi Arabia, which would only delay the “inevitable reckoning” needed for supply and demand to realign, he said .... http://www.bloomberg.com
