UAE Energy Minister Al Mazrouei says unstable oil prices do no one any good

Emirates has been committed to production cut under the "Declaration of Cooperation" with a conformity of 109 per cent in May, minister says

Mohammed Al Mazrouei says UAE aim is to rebalance oil market between supply and demand. Stefan Wermuth/Bloomberg

Fluctuations in oil prices do not serve producers and consumers alike, stated Suhail Al Mazrouei, UAE Minister of Energy and Industry and President of the Opec Conference, while addressing the 9th meeting of the Joint Ministerial Monitoring Committee (JMMC) in Vienna on Saturday.

"Our goal is to rebalance the world oil market by striking a balance between demand and supply," he said, UAE state news agency WAM reported.

He further added the UAE has been committed to production cut under the "Declaration of Cooperation" with a conformity of 109 per cent in May, while compliance of Opec and non-Opec participants collectively reached nearly 147 per cent for the same month.

Major producers outside the Opec - including Russia, Mexico and Kazakhstan - are meeting ministers from the cartel on Saturday to endorse a nominal output increase of 1 million barrels a day, which in real terms would add about 700,000 barrels a day of crude to the market starting next month, according to Bloomberg

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Opec ministers agree in principle for one million barrels a day output increase

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The non-members have already agreed to ratify the output increase, which was sealed on Friday.

“I think 1 million at this point is pretty reasonable,” Russian Energy Minister Alexander Novak told reporters in Vienna. “This is in line with current view on what should be done for the market.”

The JMMC discussed an array of proposed scenarios for an output increase to fill any potential shortage in supplies as a result of a surge in demand. This step, the committee asserted, will ease concerns of major consumers in this respect, WAM said.

The JMMC was established following Opec’s 171st Ministerial Conference Decision of 30th November, 2016, and the subsequent "Declaration of Cooperation" made at the joint Opec/non-Opec Producing Countries’ Ministerial Meeting held on 10th December, 2016.

Through the declaration, 11 (now 10) non-Opec oil-producing countries and Opec’s 13 (now 14) member countries decided on voluntary production adjustments of around 1.8 million barrels per day as part of efforts to accelerate the stabilisation of the global oil market.