Ministers weigh in on OPEC cuts

Several government officials shared their thoughts on whether or not to extend the November 2016 OPEC production cut, signalling a readiness to do so.

UAE Minister of Energy Suhail Mohamed Faraj Al Mazrouei said co-operation should be the way forward.

“The world has changed, and now we are in an environment where we need to work together to achieve a single opinion that will benefit global markets,” the minister said at a Reuters event in Dubai.

Al Mazrouei added that OPEC and non-member producers would do well to concentrate on production, and less on oil prices.

“We favour a more contemplative and cooperative approach that achieves fair prices, stability, and sustainability for the sector […] Rather than concentrating on price, it is more important to concentrate on efficiencies in production that help reduce costs and improve margins for producers,” he said.

Al Mazrouei’s comments come one day after Saudi Minister of Energy, Industry and Mineral Resources Khalid Al Falih said talk on extending the production cut was “premature,” which immediately sent oil prices down.

Meanwhile, Iranian Minister of Petroleum Bijan Namdar Zangeneh was quoted by ministry news portal Shana as saying that Iran’s backing of an extension of the agreement would be contingent on OPEC and the same non-OPEC producers backing the plan unanimously.

“OPEC and non-OPEC crude oil producers have displayed a historic esprit de corps in implementation of the organization’s output cut plan, which has proved a success, and producers have shown more cooperation month after month,” the minister said.