KHOBAR, Saudi Arabia, Jan 16, (RTRS): Kuwait’s oil output cuts could reach between 146,000 and 148,000 barrels per day, which is more than the reduction to which the OPEC member committed itself under last month’s global deal among producers, its oil minister told Sky News Arabia.
“We used this opportunity to do maintenance at some wells, whether they were at Burgan field or the northern fields,” Essam al-Marzouq said in a programme broadcast on Sunday.
“Our part of the cut is 133,000. Today I was told that we dropped by 6,000 more, and we might drop to 146,000 to 148,000.”
Marzouq said last week that Kuwait had reduced its oil output by more than its commitment, but at that time did not give details. Kuwait agreed to cut 133,000 bpd.
Based on statements by oil producing nations so far, there has been more than 60 percent compliance with the production cuts specified by the deal, Marzouq said last week. Some countries may have complied but not announced that yet.
Marzouq told Sky News Arabia that Kuwait’s oil investment strategy had not been changed by falling oil prices.
“We have a plan until 2020 to spend around $120 billion, and this has not changed because we think the fall (of oil prices) was short-term, and these were long-term investments and will have big revenues for the economy.”
Marzouq said he hoped oil prices would stay between $55 and $60 a barrel or move even higher if market fundamentals helped.
On the privatisation of Kuwait’s oil sector, Marzouq said there were some activities which could not be privatised such as exploration and production, but areas related to oil services could be privatised and Kuwait had a plan to do that in the coming two to three years.
Meanwhile, Saudi Arabia will adhere strictly to its commitment to cut output under the global agreement among oil producers, its energy minister said on Monday, expressing confidence that OPEC’s plan to prop up prices would work.
Saudi Energy Minister Khalid al-Falih, speaking at an industry event in Abu Dhabi, also said he was encouraged by signs of commitments by other participants in the deal since it took effect on Jan 1.
“Many countries are actually going the extra mile and cutting beyond what they’ve committed… I am confident about the impact … and I am very encouraged about those first two weeks,” Falih said.
The comments are the latest in a series of assurances from officials that participants will follow through on the agreement intended to help get rid of a glut. Compliance with the deal will be a key influence in early 2017 on oil prices, which at $56 a barrel are about half their level of mid-2014.
Under the accord, the Organization of the Petroleum Exporting Countries and Russia and other non-members will curtail oil output by nearly 1.8 million bpd, initially for six months.
Last week, Falih said Saudi output had fallen below 10 million bpd, meaning Saudi Arabia had cut production by more than the 486,000 bpd which it agreed to late last year under the producers’ agreement.
On Monday, he said: “We will strictly adhere to our commitment,” adding that during the six-month agreement, Saudi output would either be at the kingdom’s target under the deal or “as is the case now, slightly below”.
Producers were unlikely to extend the deal beyond six months and would allow market forces to prevail once the supply glut is eradicated.
“My expectations (are) … that the rebalancing that started slowly in 2016 will have its full impact by the first half,” he said.
“Once we get close to the 5-year average of global stocks and inventories we will basically let our foot off the brakes and let the market do its thing.”
OPEC complied with up to 80 percent of its last output cut in 2009, according to International Energy Agency data. A committee of OPEC and non-OPEC ministers to monitor the issue is meeting on Sunday.