Wednesday, December 2, 2020
banner
Home /  Business  /  Opec+ will continue to cut output to restore oil market stability: Barkindo

Opec+ will continue to cut output to restore oil market stability: Barkindo

Opec+ will continue to cut output to restore oil market stability: Barkindo

Tribune News Network
Doha
Opec+, the oil producer alliance including Russia, will continue to implement output cuts to restore stability to oil markets in the wake of declining demand due to the coronavirus pandemic, according to Opec Secretary General Mohammed Barkindo.
“Earlier, when we met, we were hopeful, almost optimistic, that this second half of 2020 will begin to see a recovery, both in the global economy as well as demand for energy and oil,” Barkindo said while speaking at the virtual India Energy Forum by CERAWeek on Monday.
“Unfortunately, both the economic growth as well as the demand recovery remains anaemic at the moment due largely to the spread of the virus. We are determined to stay the course in balancing markets,” Barkindo said.
However, the group does not expect a “relapse of massive contraction” in oil demand that was seen in the second quarter, he said.
Opec+ undertook a historic level of production cuts of up to 9.7 million barrels per day between May and July to reverse a record plunge in demand due to the pandemic. The alliance is currently drawing back 7.7m bpd from the markets.
Oil prices fell on Monday as rising coronavirus cases in the US and Europe increased concerns about energy demand, while Libya’s return to the market also weighed on prices.
Oil production in Libya, an Opec+ member and home to Africa’s largest crude reserves, is expected to rise above 1 million barrels per day in the next four weeks after the country reopened its oil ports following an improvement in the security situation, according to the state energy firm.
Oil markets have overcome the steepest declines in terms of demand but the Opec+ group of producers remains vigilant, Saudi Arabia’s energy minister said on Monday, as oil prices continue to fall on rising coronavirus cases in many countries.
“I guess the worst part is over,” Saudi Arabia Energy Prince Abdulaziz bin Salman said at the same forum. “We are very much vigilant. There is a big shift altogether in terms of where we are today and where we were in April and May,” he said.
“The discipline we put together as Opec+ is very assuring to the market. I would attribute it to everybody who is part of Opec+. This time we were different.”
The group said at a meeting earlier this month that it achieved an overall conformity level of 102 per cent with supply cuts, which is the highest since May.
Laggard producers within the group also made up for shortfalls in September by drawing back a total of 249,000 bpd to compensate for earlier overproduction.

Pages