"A ceasefire in the trade spat between the US and China is affecting the oil market," the Iranian Oil Ministry's former deputy director for OPEC affairs Reza Modir made the statement in an interview with ILNA on Saturday.
Speaking with ILNA news agency correspondent, he said that OPEC decision to cut production and fall in Saudi output has not changed OPEC's situation.
Adding to the optimism, Saudi Aramco, the world’s biggest oil company, listed 1.5% of its shares. On December 12th its market value surpassed an astonishing $2trn. And on December 13th President Donald Trump announced a preliminary trade agreement with China. That bumped oil prices higher.
"As the 2020 presidential election approaches, Saudi Arabia is not keen on challenging the United States."
Iranian ex-official added that Russia has now entered as a major player and key members such as Iran and Iraq have been marginalized.
"In fact, it can be said that OPEC is weakened and its decisive role is diminished," Reza Modir said.
The UAE’s role in the talks marks a change from years past and highlights Russia’s rising clout in the region. Russia and Saudi Arabia are the world’s top exporters, together accounting for 20 percent of global production.
Energy-market analysts are adjusting their oil supply-demand forecasts after an initial U.S.-China trade deal and OPEC supply cuts, but many still see global oil output keeping up with consumption next year.
Few analysts, though, see a repeat of 2019’s outsize gains ahead. Some investors remain skeptical that every member of the cartel will comply with the deep output cuts announced earlier this month by the Saudi Arabian-led Organization of the Petroleum Exporting Countries and its allies.