OPEC's Market Share Sinks, No Sign of Wavering on Supply Cuts

FILE PHOTO: The logo of the Organization of the Petroleum Exporting Countries (OPEC) is seen at OPEC's headquarters in Vienna, Austria July 1, 2019. REUTERS/Leonhard Foeger/File Photo
FILE PHOTO: The logo of the Organization of the Petroleum Exporting Countries (OPEC) is seen at OPEC's headquarters in Vienna, Austria July 1, 2019. REUTERS/Leonhard Foeger/File Photo
TT

OPEC's Market Share Sinks, No Sign of Wavering on Supply Cuts

FILE PHOTO: The logo of the Organization of the Petroleum Exporting Countries (OPEC) is seen at OPEC's headquarters in Vienna, Austria July 1, 2019. REUTERS/Leonhard Foeger/File Photo
FILE PHOTO: The logo of the Organization of the Petroleum Exporting Countries (OPEC) is seen at OPEC's headquarters in Vienna, Austria July 1, 2019. REUTERS/Leonhard Foeger/File Photo

OPEC's share of the global oil market has sunk to 30 percent, the lowest in years, as a result of supply restraint and involuntary losses in Iran and Venezuela, and there is little sign yet producers are wavering on their output-cut strategy.

Crude oil from the Organization of the Petroleum Exporting Countries made up 30 percent of world oil supply in July 2019, down from more than 34 percent a decade ago and a peak of 35 percent in 2012, according to OPEC data.

Despite OPEC-led supply cuts, oil has tumbled from April's 2019 peak above $75 a barrel to $60, pressured by slowing economic activity amid concerns about the US-China trade dispute and Brexit.

The decline in prices, should it persist, and erosion of market share could raise the question of whether continued supply restraint is serving producers' best interests.

OPEC and its allies have a deal to limit supply until March 2020.

The group tried to defend its market share under the previous Saudi oil minister, Ali al Naimi, who sharply ramped up production in a pump war campaign in 2014.

Naimi was hoping to win the battle, arguing that OPEC's output was the world's cheapest and would allow the group to outdo other producers such as the United States.

As a result of his strategy OPEC's market share rose, while oil prices crashed to below $30 a barrel, triggering many bankruptcies of US oil firms and over-stretching the Saudi budget.

Riyadh and OPEC were forced to return to output cuts in 2017 to support prices, and sources within OPEC say there is no sign of any willingness to return to a pump war at the moment.

"Saudi Arabia is committed to do whatever it takes to keep the market balanced next year," a Saudi official said on Aug. 8. "We believe, based on close communication with key OPEC+ countries, that they will do the same."

OPEC, Russia and other producers have been restraining supply for most of the period since Jan. 1, 2017. The alliance, known as OPEC+, in July renewed the pact until March 2020.

While helping to boost prices, OPEC's market share has fallen steeply in the last two years. World supply has expanded by 2.7 percent to 98.7 million barrels per day, while OPEC crude output has fallen 8.4 percent to 29.6 million bpd.

While OPEC agreements apply to production, OPEC's exports are also falling as a percentage of world shipments, according to data from Kpler, which tracks oil flows. Iran has led the decrease in recent months.

Nonetheless, Swedish bank SEB said that for now OPEC+ still has room to act, as the countries making most of the voluntary curbs - Russia, Saudi Arabia, Kuwait, UAE and Iraq - are still pumping at relatively high rates.

Venezuela and Iran, under US sanctions and being forced to curb shipments, have delivered the bulk of the cuts. Venezuelan supply was already in long-term decline before Washington tightened sanctions this year.

The active cutters are not very stretched at all," SEB analyst Bjarne Schieldrop wrote in the report. "They have not lost market share to US shale. Venezuela and Iran are the big losers."

While Saudi Arabia holds the biggest sway in OPEC as its largest producer, some in the group are not convinced further OPEC+ action to support prices will happen or would work.

"I really doubt there will be further action," an OPEC delegate said. "If it did happen, it will have a temporary impact because the driver is trade and the economy."



Gulf Railway Enters Implementation Phase, Targets 2030 Completion

Members of the GCC Transport and Communications Ministers Committee pose for an official photo in Manama (GCC). 
Members of the GCC Transport and Communications Ministers Committee pose for an official photo in Manama (GCC). 
TT

Gulf Railway Enters Implementation Phase, Targets 2030 Completion

Members of the GCC Transport and Communications Ministers Committee pose for an official photo in Manama (GCC). 
Members of the GCC Transport and Communications Ministers Committee pose for an official photo in Manama (GCC). 

Gulf Cooperation Council (GCC) countries signed an agreement in Manama on Sunday to advance a 2,117-kilometer railway linking all six member states by 2030, as shipping disruptions in the Strait of Hormuz underscore the need to diversify trade and supply routes.

The agreement establishes a common framework for building and operating the network and integrating national transport systems, amid regional tensions that have disrupted cargo movements, raised shipping and insurance costs, and highlighted the importance of alternative routes.

The Gulf railway is intended to strengthen regional logistics rather than replace maritime transport, which remains essential to Gulf and international trade.

The signing ceremony was held under the patronage and in the presence of Bahrain’s Crown Prince and Prime Minister Prince Salman bin Hamad Al Khalifa, with GCC transport ministers and Secretary-General Jasem Mohamed Albudaiwi attending.

The planned network will connect Kuwait, Saudi Arabia, Bahrain, Qatar, the United Arab Emirates and Oman, with full operations targeted for December 2030.

The agreement sets out member states’ obligations, coordination mechanisms, technical and operational standards, and safety requirements to ensure compatibility with national railway systems.

Bahrain’s Minister of Transportation and Telecommunications, Dr. Sheikh Abdulla bin Ahmed Al Khalifa, told Asharq Al-Awsat that each country would finance and implement the section within its territory.

He explained that GCC states had not signed prior agreements with international partners to finance or execute the project, although global companies could provide expertise and technical and technological services according to national requirements.

Project 55.9% Complete

Albudaiwi announced that the Gulf railway project had reached 55.9% completion, describing the agreement as a framework governing member states’ commitment, implementation procedures and the timetable for bringing the network into service.

While full operations are scheduled for December 2030, cross-border connections between neighboring countries could open individually once the necessary infrastructure and operational requirements are met.

This would allow completed sections to enter service progressively rather than waiting for the entire 2,117-kilometer network to be finished.

Projections indicate that the railway will carry approximately 6 million passengers and 200 million tons of freight in 2030, rising to more than 8 million passengers and 271 million tons by 2045.

Passenger trains are expected to reach speeds of 200 kilometers per hour, while freight services will operate at 80 to 120 kilometers per hour.

The network will connect economic and industrial centers, ports and logistics hubs across the Gulf, facilitating trade and the movement of passengers and goods while creating investment and employment opportunities in transport and related services.

National Financing and Potential Partnerships

Earlier estimates put the cost of the project’s core infrastructure at between $15.4 billion and $16 billion.

The Bahraini minister explained that these figures were under review because of rising costs for construction materials, services and building works. No revised estimate for the overall project has been announced.

Although each country will fund its own section, private-sector participation remains possible in certain components, subject to economic and financial feasibility studies.

The minister added that potential partnerships would depend on the requirements of individual sections, with no single financing or implementation model envisaged for the entire network.

Bahrain’s connection to the Gulf railway depends on the proposed King Hamad Causeway, which would link the island kingdom to Saudi Arabia through a railway alongside a road connection.

The project would connect Bahrain’s international passenger terminal with the Saudi railway network, providing a direct link to the wider GCC system.

Bahrain currently relies on the King Fahd Causeway for road transport to Saudi Arabia. Studies and procedures concerning the proposed King Hamad Causeway, including its railway component, remain underway as part of efforts to complete the cross-border connection.

Shipping Disruptions Highlight Logistics Challenges

The agreement has taken on added significance following recent disruptions to regional shipping, particularly reduced vessel traffic at Bahrain’s Khalifa bin Salman Port, which has increased reliance on road transport and alternative ports in neighboring countries.

Albudaiwi praised Saudi Arabia, the UAE and Oman for their cooperation during the period of Iranian attacks, citing logistical facilities, coordination and alternative cargo routes that helped maintain supply chains to other GCC countries.

He stressed the need for greater integration among transport systems, more diversified supply routes and stronger preparedness and coordination to manage future crises.

The GCC’s transport and storage sector recorded real growth of 5.7% in 2025, making it one of the fastest-growing non-oil economic activities, he noted.

At the 19th consultative meeting of the GCC Supreme Council in Jeddah on April 28, 2026, Gulf leaders called for a study on strengthening logistics integration among member states as part of broader efforts to develop transport networks and diversify trade and supply routes.

Rail and Maritime Transport to Work Together

Despite the renewed focus on rail connectivity amid shipping disruptions, the project is designed to complement maritime transport rather than compete with it.

Rail services could move goods from ports to industrial centers and domestic markets while providing additional distribution routes between GCC countries. Ships would continue to carry the bulk of international freight over long distances.

Integrating the railway into wider international logistics corridors would require further studies, agreements and coordination among governments and relevant authorities, beyond completing the rail infrastructure within the GCC.

The network is also expected to stimulate intra-Gulf trade, improve connections between production and consumption centers, and attract investment in transportation, logistics and related industries.

Additional employment opportunities are anticipated in construction, operations, maintenance and supporting services.

From a 2009 Proposal to Regional Implementation

The Gulf railway initiative dates to December 2009, when the GCC Supreme Council approved plans for a network connecting member states to facilitate trade, improve mobility for citizens and residents, and strengthen regional economic integration.

In December 2021, the council approved the establishment of the GCC Railways Authority to coordinate national efforts, monitor connectivity and operational requirements, and provide an institutional framework for cooperation.

Implementation has since progressed across member states, with completion exceeding 50% by May 2026.


Saudi Gold Refinery Obtains 10 Gold Exploration Licenses in Tanzania

A gold mine in Saudi Arabia (SPA) 
A gold mine in Saudi Arabia (SPA) 
TT

Saudi Gold Refinery Obtains 10 Gold Exploration Licenses in Tanzania

A gold mine in Saudi Arabia (SPA) 
A gold mine in Saudi Arabia (SPA) 

Saudi Gold Refinery Company (SGR) announced Sunday it has secured 10 licenses to explore gold in the Republic of Tanzania, covering a total area of nearly 1,000 square kilometers, in a move aimed at expanding the company’s mining operations outside the Kingdom.

The company said it has allocated an initial investment of $10 million to carry out exploration activities, within an ambitious plan to gradually increase total investments to $100 million. These investments will support the development, establishment, and operation of gold mines, with commercial production targeted to commence by 2030.

The announcement follows a visit to Tanzania by Faisal Suliman Al-Othaim, Deputy Chairman of the Board of Directors at SGR.

According to the company, this milestone is supported by the Ministry of Investment and the Saudi Embassy in Tanzania, highlighting the importance of strengthening Saudi investments abroad and creating new opportunities for national companies in the global mining industry.

SGR continues to advance its global expansion strategy through its international investment arm, UGM Tanzania co, which oversees its operations and investment activities in Tanzania and Ethiopia.

The company also maintains ongoing projects and business activities in Egypt and the Sultanate of Oman, while actively exploring opportunities in additional markets to further expand its global footprint and create sustainable value across the mining sector.

In the Saudi market, the company plans to develop six to ten mines before 2030, at an average rate of two mines per year. These plans are supported by the Ministry of Industry and Mineral Resources, the Saudi Industrial Development Fund, financial institutions and other relevant authorities and stakeholders.

 

 

 


Oil Falls as Trump Says New Iran Attacks ‘Unlikely’

A worker walks past oil pipes at a refinery in Wuhan, Hubei province March 23, 2012. (Reuters)
A worker walks past oil pipes at a refinery in Wuhan, Hubei province March 23, 2012. (Reuters)
TT

Oil Falls as Trump Says New Iran Attacks ‘Unlikely’

A worker walks past oil pipes at a refinery in Wuhan, Hubei province March 23, 2012. (Reuters)
A worker walks past oil pipes at a refinery in Wuhan, Hubei province March 23, 2012. (Reuters)

Oil prices fell at Monday's open after US President Donald Trump said he was highly unlikely to order new Iran attacks while talks to end the conflict make progress, despite both nations' reports of attacks on ships in or near the Strait of Hormuz.

Brent was down 84 cents, or 0.85%, to $97.48 a barrel by 0138 GMT, while West Texas Intermediate fell 32 cents, or 0.35%, to $90.51 a barrel.

The fall reversed minor gains made on Friday’s settlement as the market assessed the possibility of further US ‌strikes on Iran, ‌although Brent fell 17% last week, the ‌steepest ⁠weekly drop since the ⁠start of the COVID pandemic and the biggest in absolute terms, according to LSEG data dating back to 1988.

"It depends on whether or not they sign a very strong agreement," Trump told CNN in a phone interview. "The answer is, highly unlikely it's going to be necessary."

Trump had hinted at renewing attacks on Iran after ⁠last week's US midterm elections, but there has ‌been no sign of a large-scale ‌US military operation. Iran has said it would respond by striking US and ‌Israeli targets.

Tim Waterer, chief analyst at KCM Trade, called ‌Trump's comments "more measured" but said "the market is still waiting to see whether the midterms have produced a lasting shift in Trump’s approach to the conflict, or whether this is just another temporary change in tone."

Oil is headed ‌for a glut again as recovering Middle Eastern oil flows, rising production from other countries and ⁠weak demand have ⁠pushed global supply above consumption, JPMorgan said in a report on Friday, estimating a surplus of 1.1 million barrels per day in September, widening to 1.4 million bpd in October.

On Sunday, Iraq reached an understanding with the US to allow Iraqi oil exports through the Strait of Hormuz via a shipping lane near Oman, Foreign Minister Fuad Hussein said in an interview with Al Jazeera.

He said Iraq's losses from the Iran war and disruptions to oil exports had reached $60 billion.