KUWAIT/VIENNA: The global oil market is heading in the right direction towards balanced supply and demand, Kuwaiti Oil Minister Dr Saad Al-Barrak said on Wednesday. Barrak, also Deputy Prime Minister and Minister of State for Economic and Investment Affairs, made the statement at the 50th meeting of the OPEC+ Joint Ministerial Monitoring Committee (JMMC), which took place via videoconference. Also attending were Kuwaiti Governor at OPEC Mohammad Al-Shatti and national representative at the organization Sheikh Abdullah Al-Sabah.
The OPEC+ panel recommended on Wednesday that the oil cartel keep its current output reduction strategy unchanged after heavyweights Saudi Arabia and Russia vowed to maintain their cuts to prop up prices. Oil prices recovered in recent months and approached $100 per barrel last week as top producers Saudi Arabia and Russia have taken millions of barrels off the market. "The world is required to increase investment in all types of energy sources, including oil, to ensure meeting growing demand, recovery of the global economy and energy security.
The OPEC+ cuts are necessary to stabilize the market,” Barrak said in a statement issued by the oil ministry, praising the bloc’s precautionary measures to confront the challenges facing the global oil market. The minister also praised the Saudi and Russian decision to "to continue the voluntary reduction and extending it until the end of 2023, and its positive impact on the balance and stability of the oil market”. Barrak stressed Kuwait is committed to the OPEC+ decision to reduce production, in addition to the voluntary reduction, and that Kuwait recognizes its international role.
He pointed out that Kuwait would continue to invest in expanding oil production to reach 3.2 million barrels per day by 2024. Crude prices have eased in more recent days, however, as markets worry over a slowing economy and interest rates remaining high for longer in the United States and Europe. In a statement following the virtual meeting, OPEC+ said its JMMC "reaffirmed the commitment of its member countries” to maintain its production reduction strategy valid until the end of 2024. The panel added that it stands "ready to take additional measures at any time” depending on market conditions.
The JMMC also praised the "efforts... of Saudi Arabia” to voluntarily reduce its production by one million barrels per day (bpd) since July. The Saudi Ministry of Energy confirmed that the voluntary cut would continue until the end of 2023. It added that the kingdom’s production would amount to about nine million bpd in November and December. Russia will maintain its export cuts of about 300,000 bpd until December, Russian deputy prime minister Alexander Novak said in the government’s Telegram channel.
Both Riyadh and Moscow stressed that they would review their cuts next month to decide whether to deepen them or increase production. The next JMMC meeting is set for Nov 26 ahead of the ministerial meeting, according to a statement from the group. The JMMC has no decision-making power but discusses market conditions and makes recommendations, which are then formally discussed and decided at the organization’s ministerial meetings. –Agencies