Two of OPEC's heavyweights, Saudi Arabia and Kuwait, have recently made significant progress in their long-standing talks on resolving a shared field dispute that could produce around 500,000 bpd, reports Bloomberg on Thursday and quoting people who are familiar with problem.
Saudis and Kuwait made a breakthrough in negotiations in Riyadh last month to settle some sovereignty problems in the so-called Neutral Zone, which could lead to an agreement to launch oil production from the area, Bloomberg sources said.
The so-called Partitioned Neutral Zone (PNZ) was established between Saudi Arabia and Kuwait in 1922 to settle a territorial dispute between the two countries. From 201
The two OPEC members are now preparing new documents preparing for a next meeting expected to be held in Kuwait Saudi Arabia's energy minister Khalid al-Falih said that
Saudi Arabia expects it to be an agreement with Kuwait to resume its oil production from neutral .
Earlier this year, Saudi Arabia's energy minister Khalid al-Falih said this year.
Although the two sides reach an agreement to resume production, it is not clear how quickly oil production can be restarted, how quickly it could be hit, and how much the fields could pump with the fact that have been five years since they were closed.
As much as 500,000 bpd extra oil dividends from the Middle East could help ease the supply problem in light of the decline in production in Iran and Venezuela and fight in Libya on one hand. But these 500,000 bpd could add to the global stocking surplus that OPEC continues to eliminate by expanding production cuts to 2020, if oil demand further deteriorates in the absence of US-China trade and slowing global economy, however.
By Tsvetana Paraskova for Oilprice.com
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