Osama Suleiman from Vienna and Al-Eqtisadiah from Riyadh
The Prince Abdulaziz bin Salman, The Minister of Energy, said that indicators of restoring balance in oil markets are increasing rapidly, and global demand for oil will return to pre-pandemic levels in the fourth quarter of 2020.
He explained during the opening of the 21st meeting of the Ministerial Committee to Monitor Production Reduction, chaired by Saudi Arabia and Russia, yesterday, "Based on average expectations from various institutions, including" OPEC ", the Energy Information Administration and the International Energy Agency, it is estimated that the world will reach about 97 percent of Pre-pandemic oil demand during the fourth quarter - a significant increase after the massive declines in April and May. ”
The Prince urged OPEC members and its allies to enhance compliance with oil production cuts aimed at supporting prices, stressing the need to strengthen efforts to support economic growth, and achieve prosperity for people by supporting the stability and prosperity of national companies and the industry in general.
He said that the major oil-producing countries need to continue to limit supplies in the global market in order to stabilize the market, and they may need to continue reducing production beyond April 2022.
He stressed the main role of "OPEC +" in supporting the international economy, adding that "in the past months, markets have witnessed an improvement with a continued recovery in demand that is close to restoring pre-pandemic levels, according to estimates by international organizations and institutions."
The Prince Abdulaziz bin Salman, Minister of Energy, expressed his appreciation for the keenness of Alexander Novak, the Russian Minister of Energy, to participate in the meetings despite his infection with the Coronavirus, praising his courage and commitment, and stressed the need to strengthen international cooperation and understanding to face the repercussions of the Corona pandemic.
He pointed to continuing to improve compliance with production cuts that reach 97 percent, according to last July data, in light of Saudi Arabia's broad support for these joint efforts between producers, explaining that in the future, more commitment will be achieved, which sends a message to the world about our commitment. And our impressive achievements without any complacency or complacency.
For this part, The Russian Minister of Energy Alexander Novak stressed the need for joint cooperation to confront the pandemic, in light of Russia's efforts to address the epidemic at the global level.
He added that the pandemic has destroyed the global economy, especially the oil and gas sectors, but recovering from the pandemic is a difficult and slow task, especially with regard to crude oil consumption, with the need for everyone to adhere to the OPEC + partnership agreement, and in continuous coordination with consumers.
Novak explained that the producers reached the agreement at a difficult time thanks to the understanding with Saudi Arabia and with the "OPEC" secretariat led by Secretary-General Muhammad Barkindo, noting Saudi Arabia's estimated efforts to support market stability and balance.
Novak pointed to the need to exchange experiences and continuous coordination between producers in order to achieve the best economic results in the future and to maintain unity and flexibility to enhance market stability, adding: “We achieved good results in a short time thanks to the voluntary cuts and the contraction that occurred in American production, in addition to the continuous decline in surplus Oil stocks are a strong sign of market recovery.
For his part, Abdel Majid Attar, Algerian Minister of Energy and President of the "OPEC" conference, said that Saudi Arabia and Russia gave strong credibility to the work of the ministerial committee to monitor production cuts, appreciating the role of the "OPEC" secretariat in maintaining the balance of markets, after the great effects caused by the emerging coronavirus pandemic and its destruction for industry widely.
He added that six months after the pandemic, it is still striking millions of lives around the world and destroying the global economy and financial institutions, and the world is still struggling, through financial tools and economic stimulus, to overcome the repercussions of the pandemic.
The Algerian minister stated that the broad compliance of the producers helped the market to recover significantly to achieve the desired balance in the second half of the year and to overcome the possibility of the expansion of the second wave of the pandemic, praising Russia's efforts to find a new vaccine as an effective treatment for the epidemic.
He pointed out that compensation for production cuts of some producers helped improve market conditions in recent months, noting the necessity for all producers to fully comply with the agreement to reduce production and compensate for any previous deficiencies.
The minister noted the importance of the recent symposium held by OPEC with secondary sources of market data in order to reach the highest level of independence, integrity, and transparency in the work of the production reduction control committee, indicating that he is confident and optimistic that the sustainable efforts of the producers will achieve more good successes in the future.
According to "Reuters", the draft OPEC + statement said that a second long wave of the pandemic poses a great threat to the recovery of the oil market, and it is unlikely that the organization will amend its production policy, which currently calls for a reduction in production by 7.7 million barrels per day against a record level. A high of 9.7 million barrels per day until this month, according to informed sources. Prince Abdulaziz bin Salman said that we must seek to put the temporary compensation system behind us by removing all of the above from the surplus production by the end of September.
The draft statement, which confirmed that the next meeting of the Joint Ministerial Committee will take place on September 17th and that all compensation plans will be presented before the end of August.