Saudi Arabia has initiated a price war aimed at reclaiming market share from US shale oil producers, who face significantly higher production costs. That’s the view of Francisco Blanch, Head of Commodities Research at Bank of America, shared in an interview with Bloomberg Television.
“This won’t be a sharp, short-term clash,” Blanch said. “Instead, we’re likely to see a long, drawn-out price battle.”
He noted that the new strategy is already having an impact. Recent data from Baker Hughes shows that the number of active drilling rigs in the US has fallen to its lowest level in four years, signaling pressure on American producers.
On May 31, eight OPEC+ countries involved in voluntary output cuts announced plans to raise production by 411,000 barrels per day in July, in line with a previously agreed three-month roadmap for gradual increases. The group is scheduled to meet again on July 6 to determine output targets for August.
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Based on TASS materials