- Oil-producing countries are likely to continue with oil cut
- This has helped to stabilise oil prices globally
- Nigeria may soon be added to the oil cut
Oil producing countries are expected to extend a production cut accord later in November although the duration is still being discussed.
The Punch reports that this was disclosed by the United Arab Emirates Energy Minister Suheil al-Mazrouei on Monday, November 13.
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He spoke at an international oil conference in Abu Dhabi where he said: “I think this group of committed and responsible producers came together… and I think they will continue to do what it takes to take us to the next level.”
He explained that there were 158 million barrels of surplus crude oil remain on the market and “we need to reduce that — which means there is a potential for extension”.
Member countries of the Organisation of Petroleum Exporting Countries (OPEC) agreed a year ago to cut down oil production and Nigeria was exempted due to the country’s low oil production caused by militancy.
Mazrouei said there was near-unanimous support from member states to continue with the cut to stabilise the market.
He said: “I am hopeful that we will reach an agreement that will lead to more stabilisation in the market and more investments coming to the market.”
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The oil prices have rebounded to more than $64 a barrel from $40 a year ago after the cut agreement while huge stocks of crude built up over the past three years have reduced.
OPEC ministers are expected to meet at the end of November and among others things discuss the quota system on countries that have so far been exempted: Libya, Iran and Nigeria and possibly impose it on them.
Meanwhile, stakeholders remain divided about the wisdom in the continued search for hydrocarbon resources in the north, especially as $3 billion has already been sunk without making a commercial find.
Guardian reports that while those in favour of the search disregard the economic waste, but are encouraged by the success of oil finds in neighbouring countries like Niger, Chad and others, geologists who are mindful of the soil composition of hydrocarbon reserves, think it’s an effort in futility.
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Source: Naija.ng