For decades, OPEC's influence on oil prices was unprecedented. But the huge impact of the cartel was struck by the rapid growth in the US production of shale oil.
"Do not Saudi Arabia and OPEC longer control the situation," - he said on Wednesday at the SALT conference in Las Vegas Douglas Rachlin, Managing Director Neuch Berger's Rachlin Group.
The emergence of American producers of shale oil as a key global player who can make a profit even with low oil prices, means that OPEC can no longer "manipulate prices", added Mr. Rachlin. "The revolution of shale oil production has changed the whole situation."
In light of how much the pendulum swung, OPEC earlier this month asked the US to cease to produce such quantities of oil. The appeal was due to the flow of the supply of US shale oil producers, especially in the Arabian Basin of Texas and New Mexico, and it has helped OPEC to stabilize oil prices.
"The reality is that the US is now the dominant manufacturer ..." - said Maykl Hintts, billionaire founder of hedge fund CQS.
Hintze pointed to the increase in production of the Permian Basin, where manufacturers benefits from the unique geology which allows you to simultaneously crush a few layers of rock. They also benefited from technological progress, which significantly reduces the cost of drilling.
In recent days, OPEC seeks to reassure nervous investors. Saudi Arabia and Russia contributed to the rise in oil prices after they had promised to do "whatever is necessary" to support the market, including the extension of the deal until March 2018.
However, Hintze said that Saudi Arabia "may no longer be an influential manufacturer because of their financial situation." The country has sought to solve the problem of dependence on the oil industry, run the program "Vision 2030", an ambitious program to reduce the country's dependence on oil and diversify the state's economy.
"I hope that will not be in 2030 we worry, when suddenly the price of oil will be equal to zero", - said the Minister of Finance of Saudi Arabia's Mohammed Al-Dzhadaan told CNNMoney.
"The question is, who left and who could push the global production curve? This is the United States, "- said Hintze.
Another factor that affects the future of the oil industry, it is the policy of President Trump.
"The administration has shown incredible support", - Rachlin said, pointing to the former Director General of ExxonMobil Rex Tillerson, who became Secretary of State, and the former governor of Texas, Rick Perry, who became Secretary of Energy.
"Today, we have friends in high ranks, I feel very confident," - said Mr. Rachlin.
However, Rachlin acknowledged that Trump policy can change the political environment.
Based on materials WELTRADE
