No disputing Opec role
dubai — The UAE’s Energy Minister on Monday warned that the world will face chaos if Opec is dismantled and blamed current volatility in oil prices to geopolitical issues, global trade war concerns and currency fluctuations.
Speaking at a panel discussion on the first day of Adipec 2018 in Abu Dhabi, Suhail bin Mohammed Faraj Faris Al Mazrouei said it is not the first time that people have raised the issue of Opec’s existence and this was highlighted previously in 1970s and 1980s.
“Opec has evolved a lot over the years; if it were not a good and well-behaved organisation, I doubt it would have stayed this long. Without us [Opec], it is going to be very hard to come up with investments in the energy sector and it will be chaotic. We have seen this chaos in certain places. Sometimes, we cut production to ensure that the market is not oversupplied; we do more investments and keep those capacities for the day when the world calls on us to supply more crude,” Al Mazrouei said.
He stressed that there is no intention to dismantle the organisation. In fact, he said the possibility is that some friendly countries may join and the group will become bigger.
“It is naïve to say that you can just get rid of Opec; things will be worse if not for Opec,” he said.
Oil prices climbed by more than 1 per cent on Monday following Saudi Arabia’s move to cut its crude exports by 500,000 barrels a day in December due to seasonal lower
Suhail bin Mohammed Faraj Faris Al Mazrouei speaks on the first day of Adipec 2018 in Abu Dhabi on Monday.
demand. Brent crude futures rose 80 cents on the day to $70.98 a barrel by 1205GMT, while US crude futures rose 36 cents to $60.69 a barrel.
Khalid Al Falih, Energy Minister, Saudi Arabia, earlier denied there is any plan to break up Opec and the group will remain the global central bank for oil for a long time.
on Thursday reported that a Saudi Arabiabacked — Photos by Ryan Lim think-tank is studying effects of an Opec breakup on oil markets.
“Opec is essential for the stability of oil markets,” he said, adding that the think-tank was just trying “to think outside the box” and analyse all scenarios but added that Riyadh has “no consideration whatsoever to eliminate Opec.”
Indian Oil Minister Dharmendra Pradhan said their experience with Opec is very good.
“Gone are the days of 1970s when theseAtShTinRgAs be discussed; OpSeTcAiKs oilproducing club but now they also look into the interests of consumers. Opec is accommodative of our view,” Pradhan said during a panel
Current Opec output accounted discussion.
for one third of total supply
Al Falih said that as per technical anParloydsuisc,titohnecruet ipsroapnoes eddtoto cut oil surpepblaylabnyc1e tmheilmlioarnkebtarrels a day as demand will dwindle amidst a slowdown expected in the global economy. This will also help balance
Opec members compliance on the supply-demand equilibrium.
output cut in Oct 2018
The Saudi minister had announced on Thursday that Riyadh will reduce supply by 0.5 million barrels a day in December.
“If all things remain equal, and they almost certainly will not as thiCnugtsinwgilol bchalaonilgseu,ptphleyndutheetotechnical
Saudi Arabia’s decision analysis we saw yesterday showed that there is need to reduce
We need to do whatever it takes to balance the market
Khalid Al Falih, Energy Minister, Saudi Arabia
Opec to dominate
Opec accommodates our view and looks at consumer interests Dharmendra Pradhan, Indian Oil Minister
TusEeGdItCo EnHo OmLoDreERan
Need for 1mbpd cut
TARGETING OIL STABILITY
Decline in oil prices since early October Extra oil supplied by Opec and Russia between May and October