Abu Dhabi: A top official from the Ministry of Energy expressed optimism that oil prices will bounce back next year as global benchmark edged up by more than one per cent on Tuesday after Saudi Arabia signalled that it was ready to work with other producers to stabilise the market.

“The decline in oil price is for a short, brief period. It will not be sustained. The oil prices are expected to recover in 2016,” said Dr Matar Al Neyadi, Undersecretary of Ministry of Energy while speaking at an energy conference titled GCC Oil in World Energy Markets: Continuity and Change in Abu Dhabi.

“Stability of oil prices is essential to the UAE. Great efforts are being exerted to have consistent prices,” he added.

Oil prices plunged by more than 50 per cent in the last one year as supply increases in the market. From $115 per barrel last year, oil prices dropped to less than $45 a few days ago before edging up slightly on Tuesday. Brent was trading at $45.25 per barrel at 3:15 pm UAE time.

On Monday, Saudi Arabia’s official news agency quoted the cabinet in in a statement as saying it was ready to work with the members and non-members of the Organisation of the Petroleum Exporting Countries (Opec) to maintain the stability of the market.

Opec countries are due to meet on December 4 to decide about their future strategy. In their last meeting in June, the group decided to keep the output unchanged despite pressure from member countries to cut production to prop up prices.

Kamel Al Harami, an oil analyst from Kuwait said that it’s essential for non-Opec to cooperate in order to stabilise oil prices and to have acceptable return on the investments for Opec to retain its swing role.

“Opec will remain the source of cheapest crude oil with largest reserve in the world with large capacity and minimum investments,” he said speaking at the conference.

The big challenge for Opec, he said would be to retain its traditional role in stablising oil prices and to remain swing producer.

“There are two groups within Opec, one is rich and the other poor. This is something which Opec has to manage. Expenditure of Iran, Iraq, Nigeria and Venezuela is based on $100 (Dh367) per barrel.”

He lauded the measures taken by the UAE government to deregulate fuel prices and cut subsidies as Gulf economies reel under the impact of low oil prices.

“I wish other Gulf countries follow the excellent example of the UAE.”

Meanwhile, an industry expert expected non-Opec production to drop after 2020 and the demand for GCC (Gulf Co-operation Council) oil to pick up.

“Starting in 2020, non-Opec oil production will drop due to reduction in investments and there will be increased demand for GCC oil. Investments from GCC are continuing in oil sector,” said Dr Noora Abdul Rahman Al Yousuf, Deputy Chairperson of Economics Department of Saudi Arabia’s King Saud University speaking at the conference.

She said the GCC has 30 per cent of the oil reserves and the production is about 21 million barrels per day in 2014.