OPEC will balance oil markets, but spare capacity limited — Nigerian official

OPEC and Russia earlier rebuffed US President Donald Trump’s calls for action to cool the global oil market. (AFP)
Updated 26 September 2018
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OPEC will balance oil markets, but spare capacity limited — Nigerian official

  • ‘OPEC will do everything to stabilize, to balance the market’
  • Nigeria’s current crude oil production is about 1.7 million bpd

SINGAPORE: The Organization of the Petroleum Exporting Countries (OPEC) will act to balance the market after oil prices hit their highest in four years, but its options may be limited by available spare capacity, a Nigerian oil industry official said on Wednesday.
“It’s obvious that if you have high prices it’ll affect demand, so you have to do some market balance,” Malam Mele Kyari, head of crude oil marketing at Nigeria’s state oil firm NNPC and also the country’s OPEC representative, said.
“OPEC will do everything to stabilize, to balance the market but I’m sure you’re also aware that there’s a limit to what they can do. You must have the spare capacity,” Kyari said.
Oil prices surged this week on uncertainty over the global supply outlook following US sanctions on Iran’s oil exports and also as Saudi Arabia and Russia ruled out any immediate boost to output.
Kyari said Nigeria planned to increase its crude oil, condensate output by 100,000 barrels per day by the end of the year, up from about 2 million bpd currently.
The country’s current crude oil production is about 1.7 million bpd, he said.
In 2019, the African producer is aiming for an average output of 2.3 million bpd by boosting output from existing fields as well as starting new production from an ultra-deepwater field, Kyari said.
Located some 130 kilometers off Nigeria’s coast at water depths of more than 1,500 meters, the Egina oilfield is expected to start production in December and its output could peak at 200,000 bpd.
Kyari was in Singapore to launch the new Egina crude grade with field operator French oil major Total at APPEC.
The crude has an API gravity of 27.3 degrees and has a sulfur content of 0.165 percent, a provisional crude assay from Total showed.
The grade has a higher yield of gasoil and vacuum distillates compared with other products, according to the assay.


OPEC may cancel April meet, but hold steady on oil output: Saudi energy minister

Saudi Arabia’s energy minister Khalid Al-Falih that April may be premature to make any production decision for the second half. (Reuters)
Updated 2 min 39 sec ago
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OPEC may cancel April meet, but hold steady on oil output: Saudi energy minister

  • ‘As long as the levels of inventories are rising and we are far from normal levels, we will stay the course guiding the market toward balance’
  • ‘The consensus we heard ... is that April will be premature to make any production decision for the second half’

UPDATE 1-Saudi’s Falih: OPEC may cancel April meet, but hold steady on oil output
BAKU: OPEC and its non-OPEC partners need to reconsider if there is a need for a meeting in April, Saudi Arabia’s energy minister said on Monday, adding that there was no pressure from the United States to increase supply.
“We are not under pressure except by the market,” Khalid Al-Falih told reporters ahead of a meeting of the Joint Ministerial Monitoring Committee (JMMC) in Baku, the capital of Azerbaijan.
“As long as the levels of inventories are rising and we are far from normal levels, we will stay the course guiding the market toward balance.”
The JMMC includes major oil producers Saudi Arabia and Russia and monitors the oil market and conformity levels with supply cuts.
“There is a consensus that has also emerged that no matter what, we should stay the course until the end of June.”
Asked whether he was updated on whether the United States administration would extend the waivers it granted to buyers of Iranian crude, which are due to end in May, Al-Falih said: “Until we see it hurting consumers, until we see the impact on inventory, we are not going to change course.”
The oil producers are due to meet next in April in Vienna, but Al-Falih said this may not happen.
“The consensus we heard ... is that April will be premature to make any production decision for the second half,” Al-Falih said.
“We may not have a meeting in April,” he said, adding that the JMMC may recommend this later on Monday.