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The Minister of Energy of the United Arab Emirates on Wednesday Despite the pressure from the United States to increase production, OPEC and its allies decided not to increase the supply of oil to the market.
“I will encourage people to calm down and trust us,” Suhail al-Mazrouei told CNBC Hadley Gambling From the Adipec Energy Forum in Abu Dhabi.
Al-Mazrouei stated that he had received calls from ministers of different countries asking him to take action, but added that OPEC intends to “follow the facts.”
He pointed out that EIA’s forecasts indicate that there will be a surplus of oil in the first quarter of next year.
“By 2022, we expect that the output growth of OPEC+, U.S. tight oil and other non-OPEC countries will exceed the slowdown in global oil consumption, and cause the price of Brent crude oil to drop from the current level to an average of US$72 per barrel per year. ” EIA reported in November.
al-Mazrouei said on Wednesday: “The first quarter will be weaker and we will start to see an increase in inventories in 2022.”
“This is what the experts said, and we agree with OPEC,” he said.
He added that if OPEC+’s current plan to increase production by 400,000 barrels per day has resulted in oversupply, the alliance should not change the plan and increase production further.
However, not everyone agrees.
Helima Croft of Royal Bank of Canada Capital Markets said that in practice, OPEC+ did not increase production as planned because “some countries were unable to achieve their goals, partly because of lack of investment.”
“The question is, if it is a cold winter, especially in a cold winter, and the demand for oil increases due to conversion demand, will we still have an empty barrel in the first quarter?” Commodity Strategy told CNBC on Tuesday.
Both U.S. crude oil with Brent crude oil futures After increasing demand following the relaxation of pandemic restrictions, it has risen by more than 60% so far this year.
The United States blames high energy prices on OPEC+’s unwillingness to further increase production. Energy Secretary Jennifer Granholm calls on OPEC+ to increase crude oil supply and America president Joe Biden It also criticized the Petroleum Alliance for not producing more oil.
Biden stated on October 31: “For example, it is incorrect to think that Russia and Saudi Arabia and other major oil-producing countries will not produce more oil so that people can use gasoline to commute to get off work.”
— CNBC’s Natasha Turak and Matt Clinch contributed to this report.
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