Bloomberg reports that the United Arab Emirates said oil prices would be even higher today if it wasn’t for OPEC+.
“Fortunately, we have OPEC+,” UAE Energy Minister Suhail Al-Mazrouei. The 23-nation alliance of major crude exporters has prevented “us from having double or triple the prices and that’s something we need to appreciate.”
Brent crude’s climbed 62% this year thanks to the global economic recovery from the coronavirus pandemic and OPEC+’s supply cuts, which it started early last year.
OPEC+ is easing those restrictions at a rate of 400,000 barrels a day each month. The U.S. and other consumers such as Japan and India have called on the UAE, Saudi Arabia, Russia and other members of the group to accelerate their output increases.
“If OPEC+ wasn’t there you would see something similar to what happened with gas and coal,” Mazrouei said. “We are working together to balance the market.”
OPEC+ should remain cautious because the oil market will switch to a surplus in the first quarter of next year, he said.
That’s “due to demand softening,” he said. There are still Covid flare ups “in certain countries, so we have to be careful. We have to balance and make sure we are doing the required volumes.”
Still, members can reconvene in a matter of days if the situation changes rapidly, he said.