The Saudi-led OPEC+ alliance has pushed for an output increase, similar to their actions in 1997 during the Asian financial crisis, when they hiked production and contributed to a global oil price plunge. This move mirrors the current situation, where crude prices have yet to reach bottom despite being driven down by over 10% since Donald Trump’s trade war announcement.
Both the White House and Saudi Arabia seem content with the current price drop, as it aids their respective economic goals. However, history suggests that this is not a permanent solution and that further decline in oil prices could lead to a global economic disruption.
There are key differences between the 1997 scenario and the current situation. The OPEC+ alliance’s tactics are no longer as aggressive as they were during the 2020 price war with Russia. Instead, Saudi Arabia appears to be employing a more measured approach, likened to a “commando raid” rather than a full-scale military assault.
The outcome of this move remains uncertain, and its impact will depend on future decisions by the White House and OPEC+.
Source: https://www.bloomberg.com/opinion/articles/2025-04-08/trump-tariffs-ghost-of-jakarta-haunts-a-fragile-oil-market