Azernews.Az

By Bloomberg

OPEC is more united now about keeping its oil-production target unchanged than it was at its last meeting in November because crude prices have risen this year, according to Kuwaiti Oil Minister Ali Al-Omair.

The Organization of Petroleum Exporting Countries, which plans to meet on June 5, seeks to stabilize crude prices as volatility hurts producing and consuming countries alike, Al- Omair said Tuesday at a conference in Doha, Qatar. Producers outside OPEC should share responsibility for maintaining stable supply and prices of crude, he said, without providing details.

OPEC decided in November not to cut output amid a price slump resulting from a global supply glut driven by sluggish demand and rising U.S. shale production. Saudi Arabia led the group to keep its target at 30 million barrels a day, overcoming objections mainly from cash-strapped Iran and Venezuela, which wanted OPEC to reduce output to support prices. The decision roiled markets, contributing to a decline in prices of almost 50 percent last year.

The group was divided at its Nov. 27 meeting, and the decision to keep the output target unchanged was the “best option,” Al-Omair said.

“OPEC stuck together during a difficult test,” he said. “I expect at the next OPEC meeting in June that we will be firmer and more united, especially as oil prices have started to improve.”

June Meeting

OPEC will “stick with” its earlier decision to maintain the output ceiling when it meets next month, Abdulmajeed Al- Shatti, a member of Kuwait’s Supreme Petroleum Council, said earlier Tuesday.

“It will be very difficult” now for group members to change their minds, especially since oil prices have rebounded in recent months and recouped some of last year’s losses, Al- Shatti said in an interview in Doha. “This is a new reality that OPEC and other countries have to live with.”

OPEC, which supplies about 40 percent of the world’s oil, pumped 31.3 million barrels a day last month, data compiled by Bloomberg show. Its 12 members plan to meet June 5 in Vienna to assess the market. Brent crude, a global benchmark, added 49 cents to $67.35 a barrel at 1:30 p.m. Singapore time Wednesday. The grade has gained about 17 percent this year after tumbling by almost half in 2014.

This partial recovery eases pressure on OPEC to take action in support of higher prices, Al-Shatti said. Countries that wanted OPEC to cut production when it met on Nov. 27 have come to “realize that the decision hurts in the beginning, but in the long run it benefits all,” he said.

Al-Shatti serves with Kuwait’s oil minister on the Supreme Petroleum Council, the country’s top oil-policy body. He was expressing his own views and didn’t speak for the government.