| 16 April 2024, Tuesday |

Opec+ agreement ‘essential’ for oil market stability, Saudi Arabia’s King Salman says

Saudi King Salman called the Opec+ production deal “vital” for oil market stability and encouraged all member countries to adhere to the accord.

Oil market stability and balance are bedrock of Saudi energy policy since crude fuels global economic growth, King Salman said on Wednesday in his annual speech to Saudi Arabia’s advisory Shura Council.

In a speech published by the Saudi news agency SPA, he stated that the kingdom is “determined to continue working with the Opec+ accord, given its critical role in stabilizing the oil markets.”

He also stated that measures to retain spare capacity have proved critical to ensuring electricity supply security.

The Opec+ group, led by Saudi Arabia and Russia, has been essential in rebalancing the petroleum market, which faced record low prices last year as demand for oil fell due to Covid-19 pandemic-induced mobility restrictions.

Between May of last year and July of this year, the group implemented an unprecedented decrease of 9.7 million barrels per day, but has since reduced the supply cutbacks as demand has increased.

Opec+’s monthly meetings continue, with the goal of assessing the health of the market and adjusting supply appropriately.

Earlier this month, the 23-member group agreed to increase output by 400,000 barrels per day in January, despite concerns about demand due to an increase in coronavirus infections worldwide.

On January 4, the member countries will meet to discuss future production cuts.

Last month, Saudi Arabia’s Energy Minister, Prince Abdulaziz bin Salman, stated that Opec+’s measures, which are published in advance at monthly meetings, helped to stabilize oil markets.

The organization “brought greater sustainability, stability, predictability, and transparency to oil markets,” Prince Abdulaziz said at the Abu Dhabi International Petroleum Exhibition and Conference.

Brent, the worldwide benchmark for more than half of the world’s petroleum, was trading at $80 per barrel at 11.18 a.m. UAE time on Thursday, as worries about the Omicron coronavirus type affecting demand subsided and US stocks declined. West Texas Intermediate crude in the United States was up 0.13 percent at $76.66 a barrel.

Both standards have risen more than 50% this year, owing to increased demand as global economies recover from the coronavirus pandemic.

Opec raised its global oil demand forecast for the first quarter of 2022 earlier this month but kept its full-year growth forecast unchanged, citing Omicron’s minor impact on demand. The group of crude exporters maintained the global oil demand growth forecast for 2022 at 4.2 million bpd.

  • The National News