- Title: Saudi calls on OPEC members to stick to limits, sees oil demand up
- Date: 24th July 2017
- Summary: ST. PETERSBURG, RUSSIA (JULY 24, 2017) (REUTERS) OPEC MEETING IN PROGRESS (SOUNDBITE) (Russian) RUSSIAN ENERGY MINISTER, ALEXANDER NOVAK, SAYING: "During the first half of the year joint efforts helped us to clear more than 350 million barrels of oil supply offer from the market." DELEGATES LISTENING SAUDI ENERGY MINISTER KHALID AL-FALIH, NOVAK, KUWAITI OIL MINISTER ESSAM ABDUL MOHSEN AL-MARZOUQ AND OPEC'S SECRETARY-GENERAL MOHAMMAD BARKINDO (SOUNDBITE) (English) SAUDI ENERGY MINISTER, KHALID AL-FALIH, SAYING: "We must acknowledge, as I said before, that the market has turned bearish with several key factors driving this sentiment. Reported compliance not matching export figures as one of those, increased Libyan and Nigerian production as another, U.S. shale forecast as a third and finally the outlook past the March 2018 expiry data of the date of our agreement." VARIOUS OF DELEGATES (SOUNDBITE) (English) SAUDI ENERGY MINISTER, KHALID AL-FALIH, SAYING: "Although conformity with the production agreement remains strong at the aggregate level, some countries continue to lag, which is a concern we must address head on. In addition exports have now become the key metric for financial markets and we need to find a way to reconcile credible export data with production data in our monitoring mechanism." VARIOUS OF DELEGATES (SOUNDBITE) (English) SAUDI ENERGY MINISTER, KHALID AL-FALIH, SAYING: "The other major issue that markets are focused on is the expansion of supplies from Nigeria and Libya, both of which have been exempted from our agreement. And of course, we remain supportive of our brothers and partners and both of those nations as they work on the recovery of their oil industries, their economies. The committee however should monitor the impact of such growth on global supply and demand balances." VARIOUS OF MEETING IN PROGRESS BANNER OF OPEC MEETING
- Embargoed: 7th August 2017 17:39
- Keywords: Oil market Libya Nigeria Saudi Energy Minister Khalid al-Falih Russian Energy Minister Alexander Novak Russia Saudi Arabia Kuwait OPEC
- Location: ST PETERSBURG, RUSSIA
- City: ST PETERSBURG, RUSSIA
- Country: Russia
- Topics: Economic Events
- Reuters ID: LVA0016R2TYYV
- Aspect Ratio: 16:9
- Story Text: EDITORS PLEASE NOTE: QUALITY AS INCOMING
OPEC leader Saudi Arabia said on Monday (July 24) the group would quickly address weak compliance with output cuts by some OPEC states and would monitor rising production from Nigeria and Libya, which have been exempted from the curbs.
OPEC has agreed with several non-OPEC producers led by Russia to cut oil output by a combined 1.8 million bpd from January 2017 until the end of March. But OPEC states Libya and Nigeria were exempted to help them recover from years of unrest.
The deal to curb output propelled crude prices above $58 a barrel in January but they have since slipped back to a $45 to $50 range as the effort to drain global inventories has taken longer than expected.
Rising output from U.S. shale producers has offset the impact of the output curbs, as has climbing production from Libya and Nigeria.
"We must acknowledge, as I said before, that the market has turned bearish with several key factors driving these sentiments," Saudi Energy Minister Khalid al-Falih told a meeting of a committee that monitors the deal between OPEC and non-OPEC states.
Alongside Saudi Arabia, the committee known as the JMMC includes Russia, Kuwait, Venezuela, Algeria and Oman. It has the power to recommend measures to other producers involved in the pact, depending on market conditions.
Falih said that weaker compliance with cuts by some OPEC members and a rise in OPEC exports were helping soften prices.
Saudi Arabia and Kuwait have cut more than they pledged but others, such as the United Arab Emirates and Iraq, have shown relatively weak adherence to the limits.
"Although conformity with the production agreement remains strong at the aggregate level, some countries continue to lag which is a concern we must address head on," Falih said.
"Exports have now become the key matrix for financial markets and we need to find a way to reconcile credible exports data with production data in our monitoring mechanism," he added.
Falih said the issue of rising Libyan and Nigerian output would be addressed in the context of global supply and demand patterns, adding that demand was expected to grow by about 1.4 million to 1.6 million bpd next year, similar to 2017 and so should more than offset rising U.S. output.
Libya has been producing over 1 million bpd, below its capacity of 1.4 million to 1.6 million bpd but near its record high since violence erupted in 2011. Nigeria has also ramped up output. The two have now increased their output by about 700,000 to 800,000 bpd since the OPEC-led pact was agreed.
- Copyright Holder: REUTERS
- Copyright Notice: (c) Copyright Thomson Reuters 2017. Open For Restrictions - http://about.reuters.com/fulllegal.asp
- Usage Terms/Restrictions: None