Oil coup for Saudi Arabia as output cuts are extended

Saudi Arabia's Energy Minister Prince Abdul Aziz bin Salman. The Kingdom pulled off a coup in the world of oil diplomacy with an agreement to extend the historic output cuts credited with pulling energy markets out of chaos. (Screenshot)
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Updated 07 June 2020

Oil coup for Saudi Arabia as output cuts are extended

  • ‘Compliance is vital,’ Prince Abdul Aziz says

DUBAI: Saudi Arabia pulled off a coup in the world of oil diplomacy on Saturday with an agreement to extend the historic output cuts credited with pulling energy markets out of chaos.

At a virtual meeting of the Organization of Petroleum Exporting Countries (OPEC) and non-OPEC producers led by Russia, 23 exporters agreed to roll over the record-breaking cuts until the end of July, with a monthly option to renew the agreement after that.

The deal has strict provisions against producers who fail to comply. Some countries, notably Iraq and Nigeria, have been accused of ignoring the agreed caps on crude production.

“Effective compliance is vital if we are to secure the hard-won stability in global oil markets and restore confidence in the unity and effectiveness of the OPEC+ group,” said Prince Abdul Aziz bin Salman, the Saudi Energy Minister. “This stability and positive market sentiment will bring its own rewards.”


OPEC+ agreed unanimously that countries that have fallen short of full compliance since May 1 will make up that shortfall over the summer months and will adhere to production limits in the future.

Compliance will be assessed at monthly ministerial monitoring meetings until the end of the year. “We must be vigilant. Each of the 23 countries represented here must be on guard for any signs of backsliding from their commitments,” Prince Abdul Aziz said.


“All OPEC+ partners must deliver on their pledges for the collective pledges to be sustained. Each country has to adhere to its commitment to restrain production along the agreed guidelines.”

The minister referred to the recent “low point” when American crude briefly traded below zero, but said the OPEC+ deal, bolstered by extra voluntary cuts from Saudi Arabia, the UAE and Kuwait, had helped the global market over the worst.


Brent crude, the global benchmark, has more than doubled in price since the cuts took effect. “Demand is returning as big oil-consuming economies emerge from pandemic lockdown,” Prince Abdul Aziz said. “Through our commitment to a proactive policy, within a cohesive and collective framework, we are restoring confidence and stability to global oil markets. Today, we have grounds to be cautiously optimistic about the future.”

Energy experts welcomed the deal, but echoed the minister’s caution. “This is an important success for OPEC+. It shows ability to deliver, willingness to address discipline, and coherence in the approach,” saidChristof Ruehl of the Center on Global Energy Policy at Columbia University.

“The problem is that the more OPEC+ succeeds, the easier it becomes for private producers to enjoy the fruits of its labor.”


Saudi Arabia opens world’s largest camel hospital

Qassim Gov. Prince Faisal bin Mishaal, left, during a briefing on the world’s largest camel hospital that he inaugurated in Buraidah on Sunday. (SPA)
Updated 07 July 2020

Saudi Arabia opens world’s largest camel hospital

  • The emir also toured sheds spread over a large area which can accommodate 4,000 riding camels at the same time

Qassim Gov. Prince Faisal bin Mishaal on Sunday inaugurated the world’s biggest camel hospital in Buraidah. The Salam Veterinary Hospital will also have a modern research facility to diagnose diseases related to camels.
The governor said the project worth SR100 million is a national achievement and it will help enhance veterinary facilities in the Kingdom.
Prince Faisal toured the facility’s specialized central laboratories equipped with modern devices to conduct over 160 different types of analyses.
The emir also toured sheds spread over a large area which can accommodate  4,000 riding camels at the same time.
He was briefed on the model for the young camels unit, the ICU, CT scan unit, and the surgical theaters. The hospital is constructed on an area of 70,000 sq. meters.
Among the goals for establishing the hospital is to bring about a shift in embryology and the traditional fertilization process of camels, whose age ranges between 25 to 30 years. At present, they produce seven young camels per season. Additionally, the hospital will contribute to raising the rate of fetal production in camels from 100 fetuses to 700.