The wrong oil price is truthfully a problem for Opec+

THE best scandals are those that start when someone, somewhere, decides to say something utterly shocking: the truth! A senior official of the Opec+ oil cartel has said publicly what many thought privately – the group has been keeping oil prices too high, effectively subsidising its rivals. The result? It cannot increase production and instead relies on ever-increasing output cuts.

Afshin Javan, the No 2 official in the Iranian delegation to Opec+ (Organization of the Petroleum Exporting Countries and its allies), published a commentary on his country’s state-run news agency Shana on Nov 26. The group, he argued, faced a “a supply glut” largely of its own making following several years of production cuts.

“This strategy in support of prices has effectively encouraged higher supply outside the group, particularly on the part of the US,” he said. “That would leave a limited room for manoeuvring by Opec+ to ease its restrictions.”