Oil production cuts for market stability: Bahrain’s oil minister

TDT | Manama      

The Daily Tribune – www.newsofbahrain.com

Dr Mohammed bin Mubarak Bin Dainah, Bahrain’s Oil and Environment Minister and Special Envoy for Climate Affairs, said the decision to lower output target by 2 million barrels per day would “support market stability and avoid collapse.”

OPEC+ oil producers had agreed to lower their output target by 2 million barrels per day during November in the 33rd OPEC and non-OPEC Ministerial Meeting in Vienna that agreed on steep production cuts on Wednesday.

Bin Dainah said the meeting contributes to enhancing cooperation, exchanging ideas and expertise, and working to support market stability amid the geopolitical and economic challenges the world is going through.

He also stressed his support for cooperation between producers and consumers to face challenges, find solutions, and maintain the stability and sustainability of the oil market. Brent crude futures edged down 16 cents, or 0.2%, to $93.21 per barrel by 1020 GMT after settling 1.7% up in the previous session.

US West Texas Intermediate (WTI) crude futures lost 14 cents, or 0.2%, to $87.62 after closing 1.4% up on Wednesday. The meeting witnessed the attendance of ministers of energy and oil from various countries of the world.

Saudi rebuffs criticism Saudi Energy Minister Abdulaziz bin Salman said the real supply cut would be about 1 million to 1.1 million bpd. Saudi Arabia’s share of the cut is about 0.5 million bpd. Saudi Arabia said the cut was necessary to respond to rising interest rates in the West and a weaker global economy.

The kingdom rebuffed criticism it was colluding with Russia, which is included in the OPEC+ group, to drive prices higher and said the West was often driven by “wealth arrogance” when criticising the group. However, US President Joe Biden’s administraion criticised the deal as “shortsighted” and the White House said Biden would continue to assess whether to release further strategic oil stocks to lower prices.

The White House said it would consult Congress on additional paths to reduce the control OPEC and its allies hold over energy prices. Separately on Wednesday, Russian Deputy Prime Minister Alexander Novak said Russia could cut oil output in an attempt to offset the effects of price caps imposed by the West over Moscow’s actions in Ukraine.

Russian Deputy Prime Minister Alexander Novak, who was put on the US special designated nationals sanctions list last week, also travelled to Vienna to participate in meetings. Novak is not under EU sanctions.

He and other members of OPEC+ agreed to extend the cooperation deal with OPEC by another year to the end of 2023. OPEC + group had agreed to reduce oil production by 100,000 barrels per day in October in their meeting last month.