Oil market recovery is faster than expected
OPEC + seeks oil market balance
Coalition to wait to see for preview after Q1
Dubai –
The UAE energy minister expects the oil market to be balanced by the start of 2022 and urged coal shale oil producers to show a barrier as OPEC + begins phased supply increases this year to ensure beyond request.
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“We saw the recovery better than anyone expected,” Suhail al-Mazrouei said on January 13 at the 2021 UAE World Energy Forum organized by Gulf Intelligence.
“I hope by the end of this year or the beginning of 2022 we will see this [supply and demand] balance. “
Mazrouei also urged coal shale oil producers to show a barrier and stop pumping more crude, which could drive prices lower.
“All producers need to be careful not to flood the market; if one does that the prices will suffer,” he said.
“I think so [shale oil producers] it’s wise not to jump the gun and produce too much in the recovery year. “
“Wait and see”
OPEC + will take a “wait and see” approach beyond the first quarter amid the spread of vaccines and coronavirus recovery in several countries, the minister said.
OPEC + members, excluding Russia and Kazakhstan, will maintain their February quotas stable from January, with the exception of Saudi Arabia which cuts unilaterally 1 million b / d in February and March, a move which helped buoy oil prices. Saudi Arabia will reduce its production to 8.119 million b / d, well below its quota of 9.119 million b / d, to help bring down oil deposits that had grown as a result of the disease energy minister Prince Abdulaziz bin Salman said on January 5, after two days of OPEC + talks.
The cut is one-sided, with no other country following suit. It will more than oppose small increases given to Russia and Kazakhstan after tough negotiations. Both countries will be allowed to boost their production by 75,000 b / d combined in February and a further 75,000 b / d in March, with all other members of OPEC + keeping their quotas stable from January.