Chief Executive Officer of Emirates Oil Company
The chief executive of Abu Dhabi National Oil Co, the largest oil producer in the UAE, said that as OPEC and production cuts in oil-producing countries other than OPEC help the market rebalance, there are signs that the oil market has tightened.
According to a statement from ADNOC on Friday, Sultan al-Jaber said: "There are signs that the oil market has tightened in recent weeks."
"The OPEC agreement and voluntary reductions in production by countries other than OPEC are working together to begin rebalancing the market. This will take time. As economic activity reopens, demand will increase, but the road to the next normal level will not be smooth. "
OPEC, which is made up of 23 member states, cut its record output of 9.7 million barrels / day in May and June.
Saudi Arabia, the UAE and Kuwait announced this week that they will reduce production by an additional 1.18 million barrels per day in June based on OPEC ’s commitment to support the oil market.
The UAE's daily output in May was approximately 2.45 million barrels, down from the record 4.1 million barrels in April.
Al-Jaber said: "We have always focused on becoming one of the lowest cost producers in the world."
"This gives us the flexibility and flexibility we need at such moments."
Due to oversupply in the market, oil producers in non-OPEC countries such as the United States and Norway are also reducing production.
In the past few weeks, oil prices have risen as countries relax the blockade and promote the consumption of some fuels.
The International Energy Agency (IEA) pointed out on Thursday that OPEC will further reduce production. US oil production is falling faster than expected, and demand is showing signs of moderate improvement, so the oil market may begin to rebalance faster than originally expected.
The IEA lowered its forecast of oil demand decline from 9.3 million barrels per day last month to 8.6 million barrels per day, because the liquidity restrictions related to the epidemic gradually eased to help consumption.
* Non-OPEC production reduction *
The International Energy Agency estimates that non-OPEC countries ’daily oil production in April has fallen by more than 3 million barrels since the beginning of this year. It may reach 4 million barrels in June and may decline further in the future.
With OPEC starting to reduce production on May 1, global oil production in May will be reduced by 12 million barrels at an unprecedented rate.