Oil pro­duc­tion cut cru­cial: Saudi min­is­ter

The Myanmar Times - - Business -

SAUDI Ara­bia’s oil min­is­ter said it was “im­per­a­tive” that OPEC na­tions fi­nalise an agree­ment over a cut in oil pro­duc­tion aimed at boost­ing crude prices, ac­cord­ing to Al­ge­rian.

Khalid al-Falih met his Al­ge­rian coun­ter­part Noured­dine Boutarfa over the week­end and called on car­tel mem­bers to stick to the sur­prise cut deal, reached in Al­giers in Septem­ber.

“In this pe­riod marked by un­sta­ble oil prices it is im­per­a­tive to reach a con­sen­sus be­tween OPEC na­tions and to agree on an ef­fec­tive mech­a­nism and pre­cise fig­ures to ac­ti­vate the his­toric Al­giers ac­cord,” Mr Falih was quoted as say­ing by Al­ge­ria’s APS news agency.

The Septem­ber meet­ing of OPEC mem­bers pro­duced an agree­ment to cut the car­tel’s out­put by 750,000 bar­rels per day (bpd), ac­cord­ing to Bloomberg News.

Oil rose on the news, but crude prices are still more than 50 per­cent lower than their mid-2014 levels.

Mr Falih was op­ti­mistic that the agree­ment would come into ef­fect.

The Saudi min­is­ter said that a “fair and bal­anced” out­put deal would al­low un­rest-hit Libya and Nige­ria a re­turn of se­cu­rity while reach­ing agree­ment with Iran on a freeze.

Mr Falih and his Al­ge­rian coun­ter­part Boutarfa called for the date of an OPEC prepara­tory meet­ing of ex­perts ahead of the Vi­enna con­fer­ence to be brought for­ward to Novem­ber 21 from its sched­uled date of Novem­ber 25, APS re­ported.

OPEC of­fi­cials said in Septem­ber that the group would aim for a com­bined out­put of 32.5-33 mil­lion bpd.

On Novem­ber 11, how­ever, prices fell on news that it had pumped oil in Oc­to­ber at record levels of 33.64 mil­lion bpd, 236,000 bar­rels per day more than the pre­vi­ous month.

In its Novem­ber monthly re­port, OPEC said that its 14 mem­bers pumped 33.64 mil­lion bar­rels a day (mb/d) in Oc­to­ber, 236,000 bar­rels more than in Septem­ber.

Saudi Ara­bia’s out­put fell 51,700 bpd to 10.5 mb/d but Iraq and Iran, the next big­gest pro­duc­ers, reg­is­tered in­creases, as did Libya and Nige­ria, the re­port said.

Iran, Saudi Ara­bia’s arch foe, in par­tic­u­lar is keen to keep the taps open fol­low­ing the lift­ing of in­ter­na­tional sanc­tions un­der last year’s land­mark nu­clear deal.

The OPEC re­port chimed broadly with fig­ures re­leased by the In­ter­na­tional En­ergy Agency, which put car­tel out­put at 33.8 mb/d.

The IEA said this was “well in ex­cess” of the 32.5 mb/d to 33.0 mb/d range agreed by OPEC in Septem­ber.

“This means that OPEC must agree to sig­nif­i­cant cuts in Vi­enna to turn its Al­giers com­mit­ment into re­al­ity,” the IEA added.

Oil prices re­mained un­der pres­sure yes­ter­day over con­cerns OPEC will not be able to im­ple­ment an ear­lier agree­ment to cut out­put. –

Photo: AFP

Saudi Min­is­ter of En­ergy, In­dus­trial and Min­eral Re­sources Khalid al-Falih (right) talks with the pres­i­dent of the Or­gan­i­sa­tion of Petroleum Ex­port­ing Coun­tries (OPEC) and Qatar’s En­ergy Min­is­ter Mo­hammed bin Saleh al-Sada at the Saudi Eco­nomic Fo­rum in Riyadh on Novem­ber 6.

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