Baku, Azerbaijan, Aug.8
By Aygun Badalova - Trend:
Despite the current decline in prices, oil market is on the path to rebalancing, Mohammad bin Saleh Al-Sada, Qatar’s Minister of Energy and Industry and current OPEC President said, the cartel’s report, published August 8, said.
“Higher oil demand is expected in the third and fourt quarters”, Al-Sada said.
He noted that since February of this year, the oil price had experienced a steady improvement following a decline in crude oil production, supply outages and a decrease in oil inventories, while the global demand for oil improved in that period.
Al-Sada said that the recent decline in oil prices and the current market volatility is only temporary.
These are more of an outcome resulting from weaker refinery margins, inventory overhang-particularly of product stocks, timing of “Brexit” and its impact on the financial futures markets, including that of crude oil, he said.
He reminded that investment is needed not only to meet the growth in demand but also to stem the natural decline of oil production from operating wells.
He alluded to the expected decline in the oil supply vis-à-vis the demand and tightening of the markets in the period ahead, due to the unprecedented drop in capital expenditure in the oil and gas projects across the globe during 2015 and 2016 leading to curtailment of investments which were scheduled to be undertaken over the next four years.
OPEC report said that the cartel continues to monitor developments closely, and is in constant deliberations with all member states on ways and means to help restore stability and order to the oil market.
An informal meeting of OPEC member countries is scheduled to take place on the sidelines of the 15th International Energy Forum which will take place in Algeria from 26 to 28 September 2016.
Oil prices rose on Monday, lifted by reports of renewed talks by some members of OPEC to restrain output, Reuters reported.
US WTI crude futures were at $41.99 per barrel at 0643 GMT, up 19 cents, or 0.5 percent, from their last close. Brent futures were trading at $44.42 per barrel, up 15 cents, or 0.34 percent.