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29 March 2024

Current oil prices are fair: UAE

Published
By Reuters

Current oil prices are reasonable, a senior United Arab Emirates energy official said on Tuesday.

"I think the existing prices are fair," Matar Al Neyadi, undersecretary of the ministry of energy, told reporters at an oil industry conference in the emirate of Fujairah. Brent crude oil is now at about $97 per barrel.

Current UAE oil output is "just below 3 million bpd", and the UAE plans to raise its output capacity to 3.5 million barrels per day by 2017, Neyadi said.

Asked if he expected UAE output and exports to remain steady for the rest of this year, he said: "I don't think there is a change."

He also said the rise of shale energy production in the United States and elsewhere, which is relatively expensive compared to traditional production methods, had the effect of creating a floor for global oil prices.

"One of the impacts of shale gas is to introduce a baseline where the oil price will stay above that line," he said in a speech, adding that the baseline was around $90 per barrel. 

Premature to decide on Opec cut: UAE

It is premature to decide whether Opec should lower its oil output target when it meets in late November, UAE oil minister Suhail bin Mohammed Al Mazroui said on Tuesday.

Last week, Opec secretary-general Abdullah Al Badri said he expected the group to lower its output target. He was speaking following a meeting with Russian Energy Minister Alexander Novak, after Brent crude prices fell below Opec’s preferred level of $100 a barrel.

But on Tuesday, Al Mazroui told reporters on the sidelines of an aluminium industry conference in Abu Dhabi: “It is premature to decide - we (will) meet to discuss and agree on measures.

"We still have two months to monitor. Once we meet we will make sure our supply meets demand."

Mazroui also said non-Opec producers had a responsibility towards production. "We are one-third, they are two-thirds; so they have a responsibility."

Russia is not a member of Opec, and Novak said after meeting Badri last week that Russia did not discuss any coordination on oil prices with Opec.

Saudi Arabian Oil Minister Ali Al Naimi on Monday appeared to downplay worries about the impact of lower oil prices. Asked by Reuters while in New York if he was concerned about the recent price declines, he said: "Why are you worried about the oil market?" He declined to comment further.