Analyst: OPEC should be left to do its job

World
Europe

04:30

A two-day Organization of the Petroleum Exporting Countries (OPEC) meeting began in Vienna on Thursday with cutting output to prop up prices on the agenda – even as U.S. President Donald Trump urges the group to keep the faucets open.

OPEC, as well as non-OPEC oil producers, are recommending a production cut, and internal divisions seem to be on how much it will be. But Trump has chimed in about keeping oil prices low and repeatedly accused the cartel of keeping prices artificially high. The President said on Twitter that "the World does not want to see, or need, higher oil prices."

CGTN's current affairs commentator Gao Zhikai said that what the U.S. President was doing was against market practice and normal supply-demand relations globally.

VCG Photo

"OPEC has its job to do, after all it is still a very important producer of petroleum, as well as the largest reserve [owner] of crude oil in the world, so I think we need a very solid OPEC going forward and countries which not only produce but also export crude oil to meet up the expectation of market, to have a steady and stable price-and-supply demand relations of the oil sector," he added.

The overall relative imports from OPEC have declined over the years, now Russia and the U.S. are also very important exporting countries of crude oil with huge reserves.

"The U.S. has shifted its role, originally from the largest importer of crude oil and natural gas, but now it becomes energy-independent. I even suggested that the U.S. should be considered to be a member of OPEC, but eventually what will be done between China and the U.S. [and] whether China will really open up its market to huge amounts of exports of crude oil and natural gas from the U.S.," Gao said.

He noted that China could become an important purchaser for crude oil and natural gas produced in the U.S. without trade disputes. "It depends on how much U.S. [is] going to increase or reduce the trade tariffs against China, and whether China will implement its promise to open up its market to more exports by the U.S. to China, including energy products," he said.