Fujairah: The Organisation of Petroleum Exporting Countries (Opec) should work with non-member countries to cut more than two million barrels of over supplied oil in the market to stabilise it, former energy minister of Qatar told reporters in Fujairah yesterday.
“I think Opec should and must work with other major oil producers like Russia, Norway and Mexico to cut over 2 million barrels of oversupply. Opec cannot do it alone, no more. Opec share in the market dropped. In the 1990s, we were the biggest producers, now we are not,” said Abdullah Bin Hamad Al Attiyah.
He said that all major oil producers should decide to cut output rather than wait to see who will feel the pain first.
“They should not wait to see who will cry first. Both Opec and non-Opec countries should work together to find a solution to the problem.”
At its meeting in June, the 12-nation group decided to keep the oil production unchanged at about 30 million barrels of oil per day despite pressure from some member countries such as Iran and Venezuela to slash output. The group will meet in December to take stock of the situation.
Oil prices dropped by more than 50 per cent in the last one year due to over production and weak demand. From $115 in last June, oil prices slumped to less than $50 in recent times. The volatility in the oil market is likely to continue in the coming months.
Meanwhile, Kuwait’s Opec governor, Nawal Al Fuzaia, who took part in a panel discussion on China, said the Chinese demand would increase and oil market would balance itself. “The weakening demand in China is a short-term issue. I don’t think it will have an effect on Opec market share. We need to be patient,” she said at the Gulf Intelligence Energy Markets Forum 2015.
UAE-India ties
In a separate discussion on India, Narendra Taneja, Chairman of Energy Security Group of Federation of Indian Chambers of Commerce and Industry, said the Government of India wants more Indian companies to invest in the UAE and also provide opportunities for UAE companies to invest in India, especially in the energy, infrastructure and ports sectors.
“After the visit of the Indian Prime Minister [Narendra Modi] to the UAE, the level of relationship has gone to a completely different level. The present government is keen to deepen energy, economic and strategic ties with the UAE. We look at the UAE as a modern and forward looking economy,” Taneja said.
When asked whether India would be importing more oil from the UAE, he said they are happy to import more oil and also discuss in terms of storage of oil facilities in India.
“Things will start changing soon. There will be more investment opportunities for both the countries,” Taneja added.
India is looking to attract investments from the UAE to the extent of $75 billion through the mechanism of the UAE-India Investment Fund, which was launched during the visit of the Indian Prime Minister Narendra Modi to the UAE last month. The two countries also decided to boost bilateral trade by 60 per cent in the next five years.
“The UAE is now looking for countries where there is safety and also an opportunity to grow. Today there are very few economies in the world where you can put the money, expect it to be safe and keep growing. India is a positive market and close to the UAE geographically,” said Thangapandian Srinivasulu, Executive Director of Gulf Petrochem Group.
