UAE expects oil market to balance in first quarter
UAE Minister of Energy and Industry Suheil al-Mazrouei on Monday said supply and demand in the oil market should balance out in the first quarter of this year, following weeks of output cuts.
“My expectation is that we will see the balance during the first quarter unless something happens,” he told the three-day World Government Summit in Dubai.
“We are removing enough oil to correct the market,” Mazrouei said.
The Organisation of Petroleum Exporting Countries (Opec) cartel and other major oil producers in January began implementing a deal to cut output by 1.2 million barrels per day to shore up sagging prices.
Based on provisional figures of production levels in January, most oil producing nations were complying to the cuts, Mazrouei said.
The oil market, however, remains highly volatile and prices hover just above $60 per barrel after recovering from as low as $50 per barrel.
That figure remains far below the $85 per barrel oil hit in early October before beginning to slide.
Mazrouei said producers were “doing our best” to stabilise the market.
Khalid al-Falih, minister of Energy, Industry and Mineral Resources of the world’s top supplier Saudi Arabia, said in mid-January he expected the oil market to rebalance within weeks.
Oil prices crashed in mid-2014 to below $30 per barrel, down from over $100 per barrel, due to a glut in supplies and weakening global demand.
That prompted Opec to cooperate with non-Opec producers, mainly Russia, to trim output by 1.8 million barrels per day from t he sta r t of 2017.
The cut helped prices to rebound but they dived again after the producers abandoned the production cuts in mid-2018. AFP