Saudi Arabia's large-scale plans revealed in U.S.

OPEC+’s oil-output hikes are part of a Saudi strategy that will see the kingdom embark on a long but shallow price war designed to recapture market share, Bank of America Corp.’s head of commodities research Francisco Blanch said.

“It’s not a price war that is going to be short and steep; rather it’s going to be a price war that is long and shallow,” Francisco Blanch said.

According to him, that reflects a desire to take market share from U.S. shale, which is in relatively good health but faces higher costs of production.

The kingdom is also working to regain market share from fellow OPEC+ members, BofA’s head of commodities research noted.

“They’ve done this price support already by themselves for three-plus years,” which has allowed competitors’ output to rise. They’re done with that," Francisco Blanch said.