Impending Return of Kuwait, Iraq Strains OPEC Ties
The impending return of Iraq and Kuwait to world oil markets has strained relations among OPEC members, prompting Saudi Arabia, the world’s biggest oil exporter, to threaten to leave the oil cartel.
Iraqi and Kuwaiti exports were halted at the beginning of the Gulf crisis in August, 1990, but under a U.N. plan Iraq could sell as much as 500,000 barrels a day.
Saudi Arabia--OPEC’s biggest producer--declared this week that the kingdom would produce 8.5 million barrels a day for the rest of the year, regardless of whether Iraq resumes exports.
Cartel members now fear that the return of Iraq and Kuwait to the oil market, falling demand next spring and the Saudi stance could send prices sliding.
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