UAE energy minister ‘optimistic’ on OPEC deal extension

United Arab Emirates Minister of Energy Suhail Al Mazrouei on Monday said he is confident about OPEC and non-OPEC countries extending the agreement to cut global supply, following its expiration in March 2018.

“I am optimistic that it will be extended,” Al Mazrouei told Argaam on the sidelines of the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC). 

“Even though we cannot say for sure (how long), but we have seen consensus so far, and the fact that we still have 158 million barrels to cut,” he said, adding that all 24 participating countries will have to decide on exactly how long the deal would be extended.

“We still have data to look at,” he added.

The countries that are part of the agreement will meet at the end of the month in Vienna to assess market developments and the possibility of extending the deal to continue to support global oil markets.

OPEC members and other major oil producers had agreed last December to curb supply by about 1.8 million barrels per day (bpd) until June this year. The deal was then extended for another nine months until March 2018.

The UAE energy minister, OPEC Secretary General Mohammed Barkindo, and several key figures in the global oil and gas industry are gathered this week in Abu Dhabi for ADIPEC. The conference, which is considered one of the world’s most influential oil and gas events, has kicked off amid a rise in oil prices to a two-year high of $63 a barrel and regional tensions.

Regional unrest

While speaking at a ministerial panel at the conference, Al Mazrouei briefly responded to a reporter’s question on the recent geopolitical tensions involving Saudi Arabia, Lebanon, and Iran. He said he hoped the oil sector will continue to remain insulated from the latest developments.

“I am concerned,” Al Mazrouei said.“You cannot talk about the oil sector without talking about the geopolitics. I think the oil sector has been always kind of protected from the geopolitical tensions. I hope it will stay that way.”

Political tensions escalated last week between Saudi Arabia and Beirut, with Riyadh, the UAE, Kuwait, and Bahrain asking their citizens to leave Lebanon “immediately.”

Lebanese Prime Minister Saad Al Hariri last week announced a surprise resignation from his post in a televised broadcast from Saudi Arabia, accusing Iran and Hezbollah of meddling in his country. Speaking from Riyadh in a live broadcast yesterday, Hariri urged Lebanon to stay out of the spat between other Arab nations and Iran.

“Iran has a number of conflicts with other Arab nations, which are much larger than us,” Hariri said. “Why do we stand in between these conflicts? We have much bigger issues to handle.”

Elsewhere, Bahrain has held Iran responsible for a blast in its pipeline over the weekend, which led Saudi Aramco to suspend crude oil supply to Bahrain Petroleum Co.

“We are fighting now terrorist organizations,” UAE Energy Minister Al Mazrouei said on Monday. “There are some trying to undermine our security. I won't mention any names."

The minister added that any organization that threatens the people will not be tolerated, not just by the region, but the entire international community.

There are about 34 national oil companies and international oil companies, as well as more than 2,200 exhibiting companies at ADIPEC each year. This includes Saudi Aramco, the largest oil company in the world, as well as Abu Dhabi National Oil Company, France’s Total, and British Petroleum (BP).

Write to Reem Abdellatif at reem.a@argaam.com