OPEC remains the central oil bank: the UAE minister

The UAE Energy Minister warned on Monday that the world would face chaos if OPEC was dismantled and blamed the current volatility of oil prices for geopolitical problems, concerns related to the global trade war and currency fluctuations.

On the day of Adipec 2018 in Abu Dhabi, Suhail bin Mohammed Faraj Faris Al Mazrouei said that it was not the first time that people raised the question of the existence of Opec and that it already had was emphasized in the 1970s and 1980s.

"Opec has evolved a lot over the years, and if we had not been a good organization, I do not know it would have stayed that long. It will be very difficult to invest in the energy sector, we will have seen this chaos in some places, sometimes we have reduced our production to make sure the market is not oversupplied, we are doing more. investments and keep these capacities for the day when the world will ask us to provide more crude, "said Al Mazroui. said. [1 9659003] He pointed out that there was no intention to dismantle the organization. In fact, he said the possibility is that some friendly countries join the group and become bigger.

"It's a nave to say that you can just get rid of Opec, the situation will be worse if Opec is not there," oil prices rose more than 1% Monday after Saudi Arabia cut its crude oil exports by 500,000 barrels a day in December due to declining seasonal demand, taking the lead in Opep to counter the price defeat.

Brent crude futures rose 80 cents a day to 70.98 dollars a barrel per 1205 GMT, while US crude futures rose 36 cents to 60.69 dollars a barrel. Saudi Arabia, Minister of Energy, had previously denied any plans to split OPEC and the group will long remain the world's central oil bank.

The Wall Street Journal reported Thursday that a Saudi-backed think tank – tank is studying the effects of Opec's dissolution on the oil markets.

"Opec is essential for the stability of oil markets," he said, adding that the think tank was simply trying to "think outside the box" and badyze all scenarios, while adding that Riyadh had "no consideration for eliminating Opec".

Indian Minister of Petroleum Dharmendra Pradhan said that their experience with Opec was very good.

"The era of the 1970s was over, Opec is no longer an oil-producing club, but now they are also interested in consumer interests." In the panel discussion, Prado said stated that Opec was accommodating.

Need to reduce from 1 mpd

Al Falih said that according to technical badysis it was necessary to reduce the oil supply of 1 million barrels a day when demand will decline within the expected slowdown in the global economy, which will also help balance the supply / demand balance.

The Saudi minister had announced Thursday that Riyadh would cut the supply of 0.5 million barrels a day in December.

"If all things remain equal and they almost certainly will not do it because things will change, the technical badysis we saw yesterday showed that It was necessary to reduce the supply of a million barrels compared to October, "Falih said. the consensus is that we must do all that is necessary to balance the market. If it means reducing supplies of one million (bpd), we will do it. "

Oil Prices

Al Mazroui attributed geopolitical problems, trade conflicts and currency fluctuations to oil price volatility.

" Fluctuating oil prices result market conditions and other factors beyond the expertise of our industry, such as geopolitical challenges and the risks of global war. We need to create market conditions that create a win-win situation for producers and consumers. We want global economic growth to be healthy, "said Al Mazroui.

"Markets sometimes react excessively and we can not control the actions or decisions made by heads of state. We will therefore continue to do our part and maintain the Opec, "he said, adding that Opec was not a greedy organization that targeted certain prices, but aimed at market balance.

He warned that when oil prices are too low, it is not enough to produce. countries stop investing in the energy sector, as was the case in 2014-2015, when oil prices fell sharply.

"We have seen billions of dollars of investment lose the reason for the very low prices of oil."

– waheedabbas @ khaleejtimes.com

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