Saudi Arabia, Kuwait back more oil cuts
abu dhabi — The oil ministers of Saudi Arabia and Kuwait on Thursday said the agreement between the Organisation of the Petroleum Exporting Countries (Opec) and non-Opec nations to cut supplies for six months could be extended beyond June.
The Opec is set to review policy for the second half of the year with a meeting in May.
Saudi Arabia Minister of Energy, Industry and Mineral Resources Khalid Al Falih said the meeting in Vienna is “important”.
“We have long-term policy. The oil industry is keen to have a balance. We still haven’t reached our goals. We are still communicating with other countries. We may extend the agreement by nine to 12 months,” Al Falih said during the third GCC Petroleum Media Forum in Abu Dhabi.
He said the Gulf states will continue to “watch” the market.
“We will continue this policy. We will also put new recommendations next month,” he said. Kuwait Oil Minister Issam Abdulmohsen Al Marzooq said there has been “higher ratios” of compliance to the agreement by countries month after month from January. “The agreement was for the first quarter but we will likely have an extension. We are still trying to gauge expectations from other countries to have a consensus,” Al Marzooq said. Suhail bin Mohammed Faraj Al Mazroui, UAE Minister of Energy, said the country has been able to reduce output.
Al Mazrouei hoped the UAE, which is at the top of the pyramid with oil reserves, will hopefully continue to hold its place. He noted there needs to be reasonable expectations from shale production.
“Shale may help to stabilise market but cannot alone cater to the demand. We know the nature of the US market and always take into consideration shale oil.”
Oman Minister of Oil and Gas Dr Mohammed bin Hamad Al Rumhy said a high number of oil producers “supported” the extension of the agreement.
In an attempt to check supply crisis, Opec producers had agreed to reduce production by 1.2 million barrels a day for six months from January 1 and 11 non-Opec nations had agreed to cut half as much. The ministers, however, were unsure about non-Opec member Russia’s commitment.
— ashwani@khaleejtimes.com
abu dhabi — Gulf countries are looking beyond oil to “keep pace with the world”, their energy ministers said on Thursday.
Saudi Arabia is focusing on renewables and has set in motion a tender process for an ambitious solar project. The kingdom’s Minister of Energy, Industry and Mineral Resources Khalid Al Falih said the kingdom was focusing on different sources of energy.
“We have announced tender process for solar project. We will focus on wind and other forms also. We have programmes for exploration. We have discovered some sources of gas. With investments in renewable energy, we are just trying to develop our economy. We focus on renewables to keep pace with the world.”
However, Al Falih added that petrol will always be central to the Saudi economy and prices will rise in the future. Meanwhile, the ministers of Oman, Qatar and Bahrain said commitment to the production agreement is crucial to realising their goals and to have stability in the market.
Oman’s Minister of Oil and Gas Dr Mohammed bin Hamad Al Rumhy said: “Commitment is important for consumer and producer. We have reached 95 per cent compliance. Stability is crucial in bringing investments. One of our main goals is diversification.”
Bahrain’s Oil Minister Mohammed bin Khalifa Al Khalifa said the current prices have ‘affected investments’.
Qatar’s Minister of Energy and Industry Dr Mohammed bin Saleh Al Sada said the prime challenge was to satisfy growing demand and that it needed huge investment, time and effort. “We need more investment,” he said. Al Sada was optimistic Qatar and the region could tide past the crisis.
— ashwani@khaleejtimes.com