Saudi minister: OPEC+ deal ‘supports global economy’

Sun, 2018-12-02 19:44

LONDON: Saudi Arabia’s energy minister said on Sunday that an
agreement to cut oil output had helped stabilize the market, as
Russian President Vladimir Putin signaled the deal will be
extended.  

Khalid Al-Falih, on a visit Bogota, met with Maria Fernanda
Suarez, Columbia’s minister of energy, where the two discussed
ways to strengthen cooperation in the field of energy.

An agreement to cut oil production by some 1.8 million barrels
per day — struck in late 2016 by OPEC and other world producers
led by Russia — is paying dividends, Al-Falih tweeted. 

“I explained to (Suarez) the results of the OPEC+ agreement on
the stability of oil markets, which serves the interests of
producers, consumers and investors and supports the global
economy,” he wrote.

التقيت اليوم في
بوغوتا بمعالي ماريا فرنندا سواريز،
وزيرة الطاقة والمعادن في كولومبيا،
وناقشنا سبل تعزيز العلاقات
الاقتصادية، بالذات في مجال الطاقة،
وأوضحت لها نتائج اتفاقية التعاون
أوبك+على استقرار أسواق النفط،مما
يخدم مصالح المنتجين والمستهلكين
والمستثمرين ويدعم الاقتصاد العالمي
pic.twitter.com/iTzGjswUY7

— خالد الفالح|Khalid Al Falih (@Khalid_AlFalih)

December 2, 2018

The confirmation about the effectiveness of the OPEC+ deal,
which helped bolster oil prices after the slump that began in 2014,
came as Putin said Saturday that Russia and Saudi Arabia had agreed
to renew the pact.

Putin said the world’s two biggest exporters of crude “have
agreed to extend our agreement,” AFP reported, although there was
no immediate confirmation from Riyadh. 

“We are going to work together with Saudi Arabia,” Putin
said at the recent G20 summit in Buenos Aires. “We are going to
survey together the market situation with Saudi Arabia and respond
to it operationally.”

Putin said he had no concrete figures on the extent of the
future output cuts.

“Yes, we have an agreement to prolong our accords,” Putin
was reported as saying by Reuters. “There is no final deal on
volumes but we together with Saudi Arabia will do it. And whatever
is the final figure, we agreed to monitor the market situation and
react to it quickly.”

Expectation has been rife that the deal would be renewed as OPEC
prepares to meet this week in Vienna.

The cuts in production helped oil prices climb to four-year
highs in October, but they have subsequently slumped by some 30
percent amid worries about falling demand and a slowing world
economy.

John Sfakianakis, chief economist at the Gulf Research Center,
based in Saudi Arabia, said that a renewal of the deal would be
healthy for global markets. 

“It’s hard to predict where oil prices will go from here but
they have been heavily oversold,” he said.  

“Markets are expecting for the OPEC+ deal to be renewed, which
should be healthy for consumers and producers and the global
economy as a whole. Moreover, demand-driven worries due to trade
wars might subside, which should help lessen global growth concerns
in the short term.”

Main category: 

Saudi Arabia is world’s energy ‘shock absorber’, says
minister Al-FalihSaudi Arabia will not let another oil supply glut
form, energy minister Khalid Al-Falih says
Source: FS – All-News-Economy
Saudi minister: OPEC+ deal ‘supports global economy’