OPEC production reduction scheme a success: Al-Ghais

‘Oil surplus down by 20m barrels’

KUWAIT CITY, May 29: Kuwaiti Governor in the Organization of Petroleum Exporting Countries (OPEC) Haitham Al-Ghais said the recent official figures showed that the oil surplus decreased by 20 million barrels – lower than the decline rate in the last five years, affirming there is no longer surplus in the global oil reserve, reports Al-Rai daily.

Al-Ghais told the daily the decline rate was determined after the implementation of the agreement on reducing production by 340 million barrels. He added this decline is an indicator of the success of the production reduction scheme, clarifying the agreement aims to utilize the surplus in order to stabilize the market. He said the level of the countries’ commitment to the production reduction agreement reached 152 percent in April and this is considered an unprecedented figure since the implementation of the agreement in January 2017, in addition to the decline in Venezuela’s production – about 600,000 barrels daily.

He attributed the high price of oil in the past period to the political tension in the region and sanctions that the US imposed on Iranian oil export. Meanwhile, according to high-level oil sources, the International Marketing Sector of the Kuwait Petroleum Corporation successfully accomplished an increase of $400,000 in sales a day, reports Al-Rai daily. The same sources said the International Marketing Sector succeeded in moving quantities of crude oil exports from the European and American markets to new contracts in the Asian markets, indicating that “the volume of these crude oil exports to Asian countries was about 106,000 thousand barrels per day.”

The sources stressed the 2040 oil strategy is very ambitious and diverse, and requires flexibility and diligent followup, and must remain in full contact with customers, especially as Kuwait is considered in the world markets as stable, disciplined and committed suppliers. The International Marketing sector has generated revenues of about $10 million by converting jet fuel from the European markets to the Gulf market and benefiting from the best prices.

The International Marketing is in the process of signing a shipping agreement with China. Through this agreement, preferential facilities and reductions in the cost of unloading and shipping of Kuwaiti vessels will be provided, which will save $1.1 million annually.

The sources stressed the sector is working to compete with the European markets for diesel products that the products conform to the specifications required to increase contracts in the European and Australian markets, in addition to seeking to increase contracts in the African market in future.

In the meantime, Oil Union officials expect the statements of State Minister for Cabinet Affairs Anas Al-Saleh regarding the strategic alternative to be on the table of the National Assembly soon, reports Al-Shahid daily. They pointed out the minister’s statement is provocative and it could instigate a new crisis with the entry of some sectors in the dark tunnel; pointing out he is a minister who is supposed to defend workers in an important sector in the State taking into consideration the hazardous nature of their jobs.

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