Abu Dhabi: The UAE is 100 per cent complying with oil supply cuts in line with the agreement with oil producers, the UAE energy minister said.
“UAE compliance is 100 per cent and we announce cuts every month. As an extra assurance we are notifying our customers and markets,” Suhail Al Mazroui told reporters in Abu Dhabi on Monday.
He said the UAE has cut up to 10 per cent of their oil exports in the last two months in accordance with the Opec agreement on output cuts.
The comments come as oil prices rose to a seven-month high due to optimism expressed by major oil producers that the global market is on its way towards rebalancing.
Kuwait oil minister Essam Al Marzouq also said on Friday that output curbs were helping cut global crude inventories to their five-year average.
Brent, the global benchmark was up 39 cents at $57.25 per barrel by 2:14pm UAE time, its highest since February 23. US crude West Texas Intermediate was down 0.06 per cent at $50.63 a barrel.
In December last year, the Organisation of the Petroleum Exporting Countries (Opec) and other producers including Russia, Mexico and Kazakhstan, reached a deal to reduce output by about 1.8 million barrels a day to eliminate a global surplus that was depressing oil prices.
The agreement, which initially called for a six-month period, was later extended by another nine months to the end of March 2018.
Libya and Nigeria are exempt from the agreement.
When asked whether the oil producing countries are planning to extend the deal beyond March next year, Al Mazroui said it would be decided at the ministerial meeting to be held in Vienna at the end of November.
“We have to decide when we meet whether we are extending time or we are including some of the countries that are not included. This would be addressed at the meeting. We have to discuss it.”
On oil price forecast and fair price, he said it was difficult to predict prices as oil is impacted by many factors including supply and demand.
“We’ve been seeking a decline in the reserves, like we said earlier. There’s a decline in drilling rates and these are all factors that show the market needs changes and we are modifying.”
“There is no such thing as a fair price and we are not targeting a specific price. Our target is to balance the market.”
“There is a huge glut in the market but these (supply) reserves are declining. We still haven’t reached the average for five years. But hopefully, will reach that next year.”