Al Rumhy: Every oil producer should freeze, if not cut, production

Abu Dhabi: Oman’s Minister of Oil and Gas, Mohammad Al Rumhy, said on Monday that every oil producer should pledge to freeze their production levels, if not cut production, in order to restore stability to the oil market.

The minister — who has long been a critic of policies set by the Organisation of Petroleum Exporting Countries (Opec) to raise production levels in favour of gaining market share — said every oil producer should look at curbing their own production before asking other countries to do so.

“I think there are some countries that are struggling — production of oil is the least of their concerns; they’re [worried] about human lives. Those ones I can understand [if they don’t cut oil production levels]. It doesn’t need a genius. If you produce four million [barrels] today, you make less money than producing 3.5 million tomorrow, so what’s the problem?!” Al Rumhy told reporters at the Abu Dhabi International Petroleum Exhibition and Conference (Adipec) in Abu Dhabi. He was referring to countries like Iraq that had asked to be exempted from a recent plan by Opec to cut oil production levels.

Al Rumhy further said he was optimistic that Opec will reach a deal to freeze or cut production at their next meeting in late November. Oman is not a member of Opec. “I think the intervention in the market, which is necessary, although others may disagree, has not been enough and has been too late. I think we’re playing with fire here — economies can be destroyed. We’re seeing some countries that rely on this industry getting into trouble — the likes of Venezuela and others,” he said.

Al Rumhy also criticised oil producers, including his own policy in Oman, for a tendency to think individually rather than collectively, and said it was “common sense” to work on a production cut plan in order to restore price stability.