Oil producers expected to reach an agreement on extending the supply cut in their meeting in Vienna on November 30
UAE Minister of Energy and Industry Suhail bin Mohammed Faraj Faris Al Mazrouei on Monday said that he is optimistic about recovery in the oil market next year.
He also hoped that there is agreement reached on extending the supply cut during the Opec and other non-Opec producers meeting in Vienna on November 30.
In his address at Abu Dhabi International Petroleum
Exhibition Conference, he said: "I am optimistic about the second half and the whole 2018 is going to be a recovery year. We will see more investments coming to the region."
He rubbished thought process that one form of energy will replace another.
"We need to utilise whatever technology we can tap on to make our industry smarter, more efficient and cost effective. Probably we will need all forms of energy. And it may not be enough if we don't consume less and not work on improving efficiencies. At the end of the day, there are more people going to come into the world and they will require way more energy than what we can manage."
Al Mazrouei said the phenomenal decision of 24 Opec and non-Opec countries to cut production has removed almost 180 million barrels from storage in less than a year.
"The dedication and commitment by those 24 countries has benefitted the whole industry. It would have been very difficult without them," the minister said.
He lauded the 'extra efforts' taken by Adnoc to reporting actual export cuts to the market and customers. "You cannot be more transparent than that to show your commitment," he said appreciating the steps taken by the UAE Minister of State and Adnoc Group CEO Dr Sultan bin Ahmad Sultan Al Jaber.
He urged more countries to join the historic exercise followed by 24 Opec and non-Opec countries. "My prediction for the (Vienna) meeting is that they will continue to take us through to the next level. There is a potential for an extension. I haven't heard anyone talking about not to consider an extension. The period of extension is subject to discussion during the meeting."
The decision on extension, he said, is a complex one. "We need every minister to agree. So no one can be sure as to what's going to happen in the meeting but I hope we reach an agreement."
Talking about a healthy oil price, he said: "It's not only the NOCs which will decide the prices. The price is going to decided based on the level of investment."
He added: "I am still not happy with the price going for $40 to $64 within one year. That's too much of fluctuation within one year. It's not healthy for the producers or consumers. We need some sort of stability on the fluctuations and that's going to take time. I feel that next year we will have low escalation if nothing in geopolitics will happen."
UAE looking for partnerships
He said the level of engagement with other countries will continue in future.
"We are looking forward to fair and competitive partnership, and definitely a long-lasting relationship. I think there is new wave of newcomers. We have allowed consumers to be on the table. We have invited them in and also invested with them in their countries," he said referring to Japan, Korea, China and India. "You will see more projects coming with them in their countries or here. This is the nature of partnership we are looking at. It's a two-way relationship," the minister added.
Abu Dhabi Executive Council Deputy Chairman Sheikh Hazza bin Zayed Al Nahyan opened the event on Monday. The four-day meeting is held under the theme, 'Forging Ties, Driving Growth' at the Abu Dhabi National Exhibition Centre.
Reporting by Ashwani Kumar
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