Saudi Arabia invites Brazil to OPEC

Saudi Arabia has proposed to President Jair Bolsonaro to inclusion of Brazil in the Organization of Petroleum Exporting Countries (OPEC). The invitation was made at the end of the president’s trip to the Middle East and Asia. Bolsonaro said he will need to consult an economic team and the ministry of Energy before accepting the offer.

This proposal reflects the importance of the country in the oil, mainly because of pre-salt production and its exporter feature. However, some experts believe that this entry would not be advantageous, as the country plans to accelerate its production of oil, especially in pre-salt. This is because the organization sets quotas for its member countries, limiting production to keep the price high commodity. In addition, Brazil could not control the operation of private oil companies in national territory.

Moreover, the growing Brazilian production has made it difficult to opec’s effort to keep oil prices at the current level. Now, with the auction of the onerous assignment that will take place on November 6, Brazil is about to become a giant in production, and if you accept the invitation, you can become opec’s third largest producer, after Saudi Arabia and the Iraq. 

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