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The United Arab Emirates sees a strong rationale for extending an OPEC-led deal with global oil producers to trim production beyond the first quarter of 2018, the country's energy minister has said.
“We removed almost 180 million barrels from storage but we still have an oversupply of 160 million barrels above the five-year average which was comfortable for the industry for a long time,” Suhail Al Mazrouei, UAE Minister of Energy said at a ministerial meeting on Tuesday at the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC).
OPEC and non-OPEC oil producers are set to meet in Vienna on November 30, where they will discuss extending the global oil deal to trim production by a combined 1.8 million barrels per day beyond March 2018.
Commenting on whether the deal will be extended or not in the next meeting, Al Mazrouei told reporters on the sidelines of the event: “Let us not jump to conclusions… We need to wait as there are 24 countries involved and every country has the right to say yes or no.
“But I think the deal has worked remarkably well, better than expected in the sense of compliance and in the sense of bringing all of those different countries together,” he added.
Al Mazrouei highlighted the need to lead a stabilised correction in the market, adding that major fluctuations of prices within the same year is not good for the overall investment appetite.
“We are not targeting a certain oil price. We are rather targeting the market stability and for investors to come back to producing countries and invest again,” he told reporters.
“We had a stagnation period, which is not good to the market and we had more growth in demand than expected. So when you have that, combined with reduced investments, you know you’re going to have a problem down the road. We want to reduce the inventories to a level that is comfortable for the investors to come back and invest,” he added.
Further reading:
© ZAWYA 2017
“We removed almost 180 million barrels from storage but we still have an oversupply of 160 million barrels above the five-year average which was comfortable for the industry for a long time,” Suhail Al Mazrouei, UAE Minister of Energy said at a ministerial meeting on Tuesday at the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC).
OPEC and non-OPEC oil producers are set to meet in Vienna on November 30, where they will discuss extending the global oil deal to trim production by a combined 1.8 million barrels per day beyond March 2018.
Commenting on whether the deal will be extended or not in the next meeting, Al Mazrouei told reporters on the sidelines of the event: “Let us not jump to conclusions… We need to wait as there are 24 countries involved and every country has the right to say yes or no.
“But I think the deal has worked remarkably well, better than expected in the sense of compliance and in the sense of bringing all of those different countries together,” he added.
Al Mazrouei highlighted the need to lead a stabilised correction in the market, adding that major fluctuations of prices within the same year is not good for the overall investment appetite.
“We are not targeting a certain oil price. We are rather targeting the market stability and for investors to come back to producing countries and invest again,” he told reporters.
“We had a stagnation period, which is not good to the market and we had more growth in demand than expected. So when you have that, combined with reduced investments, you know you’re going to have a problem down the road. We want to reduce the inventories to a level that is comfortable for the investors to come back and invest,” he added.
Further reading:
- ADIPEC_2017: Oman to commission second half of Khazzan gas project next year - minister
- ADIPEC 2017: Energy sector remains neutral in Qatar rift, says Omani oil minister
- Oil markets cautious as OPEC cuts are met by rising US output
- OPEC allies unlikely to delay decision on oil cut extension
- Winning battle to end oil glut: OPEC
© ZAWYA 2017
