August 2, 2021 oil and gas

Oil sailing ‘smoothly’ as OPEC-plus takes charge


YES … Leave it to the OPEC-Plus to manage the oil market and prices. The trick of managing the market was long overdue, but finally it has taken shape with the Saudi oil minister in charge, leading the music, and correcting or fine-tuning to bring everything back again into harmony. This is what happened recently, as the situation was corrected, and the group was brought back into harmony with improved tuning with the Saudi master in charge. From today, the OPEC-Plus volume will increase by 400,000 barrels per day, as per the recent agreement.

The agreement will remain in force until the end of next year. This time OPEC-Plus did something else – it also revised or upgraded the base volume for most of its group. It increased the production base line of Saudi Arabia and Russia from 11 million to 11.5 million barrels per day, for Emirates from 3.17 million to 3.5 million, and for Kuwait and Iraq by 15,000 barrels per day. It is worth noting the new baseline production for Kuwait will remain below three million and is to be firmly based at prediction of 2.909 million barrels per day.

This is a shocking and annoying figure, despite our own ministers claiming that Kuwait reached production levels ranging between 3.2 million and 3.3 million barrels. Today we discover that even three million is not there and will not be available soon. So what happened to our investments worth billions of dinars to search and develop new oil fields or to maintain, improve, and develop the existing ones. What is happening to our industry? Why are we so far behind? While the neighboring countries are booming and jumping with their oil production rates, we in Kuwait are retreating in this regard and can’t even manage three million barrels of the volume that our oil industry is confident of.

What happened to our cash that went exclusively to search for fresh oils? Who is accountable despite the annual reminders by the State Audit Bureau of KPC’s failure in reaching any of established approved targets? Now that OPEC is set in good order and can manage the oil market, which is closely monitored every month, it is time to be ready for another OPEC-Plus meeting with its other partner – Russia – for providing the market with the necessary ration of oil. Oil market is now well disciplined and organized, even with the arrival of new oil from Iran, for which the group is ready. The experience of the last meeting and the end result show that OPEC-Plus is in control, and the era of weak oil prices have gone forever… even during the time of depressing rate of demand.

arabtimesonline



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