Saudi Arabia's Energy Minister Abdulaziz bin Salman said on Tuesday he would make short sellers "cry out" and tell them to "be careful". The OPEC+ meeting, which will decide future oil policy, will take place in a few days.
Crude oil traders were caught off guard last month when Saudi Arabia and its partners announced unexpected production cuts. Fund managers have turned bearish on crude again in recent weeks amid concerns about the economy.
Saudi Energy Minister Salman told the Qatar Economic Forum in Doha: "I have been warning them that they may be punished and they really felt it in April. I don't need to show my cards, I'm not a poker player, but I just want to tell them now: be careful! "
Brent crude, the international benchmark, has fluctuated around $75 a barrel this month, plagued by the risk of a US government default and a US recession. Next, OPEC+, a group of 23 countries, will meet in Vienna on June 3-4 to review crude oil production policy for the second half of the year.
While several OPEC+ representatives said further cuts were not necessary at this time, as the curbs already in place would help tighten global supply markets, the Saudi energy minister is known for "orchestrating unexpected interventions," Therefore, the market still pays close attention to this meeting. "We have to be vigilant, we have to be proactive, as we have always said," he said.
In theory, global oil inventories could tighten significantly for the rest of the year as Chinese energy demand recovers, with OPEC's own data showing a shortfall of about 1.5 million bpd. Major oil consuming countries represented by the International Energy Agency (IEA) criticized OPEC for excessively restricting supply, which has exacerbated global inflationary pressures.
Bears make a comeback
However, the latest market data showed that speculators seeking to short crude oil were making a comeback, with hedge funds taking short positions at their highest level in more than a decade across a range of oil contracts.
"The current speculative positioning is so extreme that key OPEC members are likely to respond, so we recommend a defensive strategy," Standard Chartered analysts Paul Horsnell and Emily Ashford said in a note on Monday.
The Saudi energy official said OPEC+'s actions showed it was a force stabilizing the crude oil market, rather than engaging in price gouging, and blamed market volatility on erroneous forecasts by consuming countries and some policy influences, such as the unexpected emergency inventory release by the US.
More popular news:
'Bond King' Jeffrey Gundlach Says Sharp Fed Rate Cuts By Year-End Will Push Up Gold Prices
Copper Shortage Is Irreparable Even after Biggest Mergers and Acquisitions, Here’s Why
Goldman Sachs Lowers Price Forecast for Aluminium, Copper in 2023, Sees Nickel Price Plunging
Zinc Prices to Plunge by 2025, Here's Why
G7 to Expand Sanctions Covering Metals on Russia, Promises Further Support for Ukraine
IMF: US Debt Defaults Will Take a Heavy Toll on Global Economy, Global GDP Growth Can Plunge
BofA Sharply Lowers Forecast for Oil Price, Global Oil Consumption in 2023
Takeaways of Warren Buffett and Berkshire Hathaway’s 2023 Annual Meeting
US Treasury Bill Rates Soar to Record High on Debt Ceiling Jitters
No Other Country can Replace China's Manufacturing Industry Including India
A Bull Gold Market Has Just Begun
