The Organization of Petroleum Countries’ (OPEC) stakeholders have said that tough times still lie ahead for oil markets despite OPEC+ coalition’s implementation of a historic production cut that began in May.
The production cuts, albeit sabotaged by some OPEC members was extended into July. “Although we are not yet out of the woods, but we have proven together with our partners in non-OPEC…that multilateralism is irreplaceable especially in our diverse world of energy that is sometimes punctuated with geopolitics,” the OPEC Secretary General, Mohammed Barkindo told a webinar organised by the Canada-UAE Business Council.
The 23-member coalition of OPEC+ are in the midst of a record 9.7 million barrel per day cut that started in May and was extended till July, excluding Mexico’s 100,000 b/d cut. The output curbs will gradually ease after July through to April 2022.
UAE, OPEC’s third largest oil producer, is also cutting an extra 100,000 b/d in June, joining Saudi Arabia, Kuwait and Oman in implementing cuts on top of their OPEC+ commitments this month to help rebalance the market.
Suhail al-Mazrouei, the UAE energy minister, told the webinar these remain tough times for the oil industry, but that the oil markets are rebounding.
“No one predicted, even after we announced the 9.7 million b/d cut that the market will quickly rebound to where we are today,” he said. We are all keen to produce our barrels to contribute to our economy but we need to do it at the right pace and at the right time,” he said
Chibisi Ohakah, Abuja
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