Emirati Minister: Additional Cuts Should be Enough to Balance Oil Market

Additional oil output and export cuts made by Saudi Arabia and Russia earlier this week should be enough to help balance the oil market, United Arab Emirates' energy minister Suhail Al Mazrouei told reporters on Wednesday. OPEC+, a group comprising the Organization of the Petroleum Exporting Countries and allies including Russia which pumps around 40% of the world's crude, has been cutting oil output since November in the face of flagging prices.

Saudi Arabia and Russia, the world's biggest oil exporters, deepened oil supply cuts on Monday in an effort to send prices higher. Yet the move only briefly lifted the market. On Wednesday, benchmark Brent futures traded more than 1% down at US$75.30 per barrel, lower than the US$80-US$100 per barrel than most OPEC nations need to balance their budgets. "This (the latest addition output cuts) is enough to assess the market and look at the market balance," Mazrouei told reporters, adding that the UAE would not be contributing to fresh cuts.

Al Mazrouei affirmed that voluntary oil output cuts by OPEC and non-OPEC producers have contributed to ensuring global oil market stability and balance in market fundamentals between supply and demand. In statements on the sidelines of the 8th OPEC International Seminar, which kicked off today in Vienna, Al Mazrouei said that oil producing countries have in-depth knowledge of market fundamentals, noting that the global oil market fluctuates as a result of information discrepancy.

He explained that the periodic meetings of OPEC and OPEC+ help limit fluctuations and restore market balance and stability, through cooperation and joint efforts, especially as OPEC and OPEC+ member countries account for around 40% of the global oil output. ''Through our periodic meetings, we are constantly working to monitor markets and relevant shifts to ensure taking timely and effective measures, which help boost stability across the market and drive economic development worldwide, Al Mazrouei added.

He stressed that oil producing countries have a more comprehensive view of the market, noting that they present a realistic outlook of supply-demand balance through data issued by independent sources that ensure credibility and unbiased decision-making. The minister concluded by stating that the UAE is one of OPEC+'s top exporters and plays a crucial role in assisting the organisation's initiatives and decisions, which help meet the oil and gas needs of all world nations while committing to voluntary oil output cuts to ensure market stability.