OIL CUT EXTENDED TO DEC 31, 2018
(Opec) and non-Opec Ministerial Meeting in Vienna, Austria, last month.
He represented Malaysia in the ministerial meeting, while senior officers from the department’s Economic Planning Unit and Petronas attended technical meetings a day before the ministerial meeting.
“The production adjustments extension is needed to reduce oil inventory to a more reasonable level that will provide stability and sustainability in terms of price, and demand and supply.”
Rahman said for the period between January and October this year, Opec and non-opec countries reduced the inventory level by more than 600 million barrels.
He said the extension of the production adjustments would enable the oil market to rebalance itself by the end of next year.
“This is one of the factors why oil prices have firmed up since last year.”
During the ministerial meeting, Rahman shared Malaysia’s views in agreeing to extend its participation in the production adjustments policy.
“Malaysia is not keen to see oil prices reaching US$100 (RM409) or more per barrel like before. It prefers a stable oil price at a reasonable level as price volatility is bad for national revenue projection.
“A stable and balanced oil price would facilitate economic budgetary planning while keeping inflation in check.”
The meeting marked the first anniversary of the Declaration of Cooperation between Opec and non-opec countries, which was signed in December last year.
At the inaugural meeting, Malaysia committed to a voluntary reduction of its crude oil and condensate production by 20,000 barrels per day.