OPEC remains oil central bank: minister of the United Arab Emirates



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The UAE Energy Minister stressed that there is no intention to dismantle the organization.

The United Arab Emirates Energy Minister on Monday warned that the world will face chaos if OPEC is dismantled and blame the current volatility in oil prices for geopolitical issues, worries about the global trade war and currency fluctuations.

Speaking on a panel on the first day of Adipec 2018 in Abu Dhabi, Suhail bin Mohammed Faraj Faris Al Mazrouei said that it is not the first time people raise the question of the existence of OPEC and this was highlighted earlier in the 1970s and 1980s as well . .

"OPEC has evolved a lot over the years, if it were not a good and well-behaved organization, I doubt it would have stayed that way for long. Without OPEC, it will be very difficult to get investments in the energy sector and it will be chaotic. chaos in a certain place. At some point we cut production to ensure that the market is not overloaded, we make more investments and we keep those capabilities to the day the world calls us to provide more crude oil, "Al Mazroui said.

He pointed out that there is no intention of dismantling the organization. In fact, he said that the possibility is that some friendly countries can come together and the group become bigger.

"It's a must to say you can just get rid of OPEC, things will be worse if OPEC is not there," he said.
Oil prices rose more than 1 percent on Monday after Saudi Arabia cut its export output of 500,000 barrels a day in December due to lower seasonal demand, taking the lead in OPEC to stem the price decline.

Brent crude futures rose 80 cents a day to $ 70.98 a barrel at 1205GMT, while US crude futures rose 36 cents to $ 60.69 a barrel.

Opec to dominate

Khalid Al Falih, Saudi Arabia's energy minister, has previously denied any plans to dismember OPEC and the group will remain the world's central oil bank for a long time.

The Wall Street Journal reported Thursday that a Saudi-backed study group is studying the effects of OPEC's collapse on oil markets.

"OPEC is essential for the stability of the oil markets," he said, adding that the think tank was just trying to "think outside the box" and analyze all scenarios, but added that Riyadh "has no regard for eliminating OPEC ".

Indian oil minister Dharmendra Pradhan said her experience with OPEC is very good.

"The days of the 1970s disappeared when these things used to be discussed, OPEC is no longer an oil producing club, but now it is also of interest to consumers." OPEC accommodates our vision, "Pradhan said during the panel discussion.

Need to cut 1mbpd

Al Falih said that according to the technical analysis, there is a need to cut oil supply by 1 million barrels per day as demand will decline amid the expected slowdown in the global economy. This will also help balance the supply-demand balance.

The Saudi minister announced on Thursday that Riyadh will reduce supply by 0.5 million barrels per day in December.

"If all things remain the same, and almost certainly will not change, the technical analysis we saw yesterday showed that there is a need to reduce supply from one million barrels in October," Falih said.

"The consensus is that we need to do whatever it takes to balance the market. If that means cutting the stock in a million bpd, we will."

Oil price

Al Mazroui blamed geopolitical issues, concerns about the trade war and currency fluctuations due to the volatility of oil prices.

"Oil price fluctuations are the result of market circumstances and other conditions outside of our industry, such as geopolitical challenges and commercial war risks. We need to create market conditions to make it a win-win situation for producers and consumers. want to allow world economic growth to be healthy, "said Al Mazroui.

"At some point, markets react exaggeratedly and we can not control the actions or decisions made by heads of state. So we will continue to do our part and keep OPEC together," he said, adding that OPEC is not a greedy organization but aiming at the balance of the market.

He warned that when oil prices are very low, producing countries will no longer invest in the energy sector, as was the case in 2014-15, when oil prices fell sharply.

"We've seen trillions of dollars in investments pulling away because of very low oil prices."

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