Producers remain committed to cutting output: Al-Mazrouei
Speaking at an event in London on Feb. 20, he said it was important that the oil industry did not repeat the “mistakes of the past,” where producers became “so excited” by rising shale oil production that they overproduced, causing an imbalance in the market and job losses.
A glut in oil supply caused global oil prices to plummet from mid2014.
Al-Mazrouei said OPEC plans to meet US shale oil producers at the CeraWeek event in the US next month when they will explore the outlook for shale, rather than relying solely on analysts’ reports on the industry.
He underlined the commitment of all 24 OPEC and non-OPEC countries, including Russia, to continue to cut oil production by 1.8 million barrels per day until the end of 2018, following last November’s agreement.
“We are focused on what we agreed in 2017 to work together to balance the market,” he said, refuting suggestions of talks within any countries about an exit strategy from the deal.
“I don’t think we are talking about an exit strategy for the time being, we are focused on one target, which is balancing the market,” he said.
Al-Mazrouei said he would like OPEC and non-OPEC oil producers to continue to work together beyond 2018 to ensure “market stability,” as the “job is not complete.”
Commercial oil stocks in the Organization for Economic Cooperation and Development (OECD) had fallen by more than 220 million barrels since the beginning of last year, compared to the five-year average, he said.
There remained a further 100 million barrels to remove from the market to reach the five-year OECD inventory average.
Al-Mazrouei confirmed that there were plans for an alliance of the 24 non-OPEC and OPEC producers, but he refused to give details while the plans were still in draft form.
He expressed the hope that the alliance would not only be based on benefiting members, but also on “how we contribute to world economic growth.”
And he also reconfirmed previously reported recommendations that oil producer countries needed to have capacity buffers in place to help deal with any shocks to the market.
LONDON: UAE Energy Minister and OPEC President Suhail Al-Mazrouei said the US shale oil industry was “not a threat” to OPEC oilproducing countries.