Abdalla el-Badri, the secretary-general
of the Organisation of Petroleum Exporting Countries (OPEC), states that
the decline in global crude oil prices may not abate until 2017 as the
oil market is expected to rebalance within two years.
The secretary-general expressed concern about the impact of low oil prices on investment and the consequences for future supply when he spoke on the issue on Tuesday, October 6, in London. However, the official insisted that rebalancing the world oil markets was the responsibility of all producers and not a burden to be borne by OPEC alone.
He said: “We have an overhang of 200 million barrels in the market. All of us should work together, OPEC and non-OPEC…all of us have to work together to see how we can get rid of this 200 million barrel overhang. You will see the result. This means less supply and higher prices in the future.”
Badri noted that overall global investment in oil could drop by $130billion this year from $650billion in 2014.
The OPEC official also said that non-OPEC supply growth was slowing and was expected to be zero next year, while the call on OPEC crude was rising.
“So, we see that there is an improvement in the market, but how much the price will improve we don’t know,” he said.
Abdalla el-Badri also added that he expected Iran’s full return to the market was to be discussed at OPEC’s next meeting on December 4 in Vienna. The Iranian side claimed it expects to boost its crude exports by one million barrels per day within six months since sanctions lifting.
Generally, OPEC expects global demand for its crude to rise to 30.3 million barrels per day in 2016, about one million bpd more in comparison with 2015.
Badri said: “We will see the effect of the cut on production. This will mean less supply in the near future. We are seeing now a low price. After a few months, we will not see this. We will see a higher price again.”
OPEC daily basket price stood at $44.89 a barrel Monday, October 5, 2015.
Source: Naij
The secretary-general expressed concern about the impact of low oil prices on investment and the consequences for future supply when he spoke on the issue on Tuesday, October 6, in London. However, the official insisted that rebalancing the world oil markets was the responsibility of all producers and not a burden to be borne by OPEC alone.
He said: “We have an overhang of 200 million barrels in the market. All of us should work together, OPEC and non-OPEC…all of us have to work together to see how we can get rid of this 200 million barrel overhang. You will see the result. This means less supply and higher prices in the future.”
Badri noted that overall global investment in oil could drop by $130billion this year from $650billion in 2014.
The OPEC official also said that non-OPEC supply growth was slowing and was expected to be zero next year, while the call on OPEC crude was rising.
“So, we see that there is an improvement in the market, but how much the price will improve we don’t know,” he said.
Abdalla el-Badri also added that he expected Iran’s full return to the market was to be discussed at OPEC’s next meeting on December 4 in Vienna. The Iranian side claimed it expects to boost its crude exports by one million barrels per day within six months since sanctions lifting.
Generally, OPEC expects global demand for its crude to rise to 30.3 million barrels per day in 2016, about one million bpd more in comparison with 2015.
Badri said: “We will see the effect of the cut on production. This will mean less supply in the near future. We are seeing now a low price. After a few months, we will not see this. We will see a higher price again.”
Source: Naij
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