Kuwait will be taking a leadership role in monitoring the Organization of Petroleum Exporting Countries’ (OPEC) week-old production freeze deal, according to acting oil minister Anas al-Saleh, who said he would request the committee enforcing the agreement to host a meeting in the Gulf country by the end of the first quarter of 2017.
"In my capacity... as head of the committee... I will call for a meeting of the first Monitoring Committee to take place in February or March 2017, " Saleh’s most recent statement reads. "We will soon inform (our) customers that we will incorporate and apply a cut to their monthly contractual commitments and liftings in accordance with OPEC's recent agreement. I am certain that such actions will contribute to the re-balancing of the market and assure stable markets."
The November 30th agreement to limit bloc-wide output to 32.5 million barrels per day has been met with strong political support from all of the cartel’s members, with Iran declaring it a diplomatic victory and Saudi Arabia parading its leadership as evidence of the effective management of Saudi Arabian Oil Co. – the national energy company the KSA plans to IPO next year.
Officials familiar with dealings between Kuwait and Saudi Arabia told Bloomberg that both countries had agreed to make sure that any output from shared fields between the neighboring countries would not cause either nation to exceed its production quota under the deal.
The Wafra field in Saudi Arabia, run by Chevron, shut down in May 2015 after bureaucratic red tape prevented the company from retaining access to its equipment. Another offshore field called Khafji - a joint venture between Saudi Arabia and Kuwait – shut down in October 2014 due to ambiguous environmental concerns.
“We are encouraged by efforts underway by all appropriate parties to resolve the issue,” Sally Jones, a Chevron spokeswoman, wrote to Bloomberg this week. “Production will remain shut in until the situation is resolved.”
By Zainab Calcuttawala for Oilprice.com
More Top Reads From Oilprice.com:
- Trump Could Fuel A Nuclear Energy Boom In 2017
- OPEC Cheating Will Cap Oil At $52
- OPEC Winners: Iran Brags It Can Now Sell As Much Oil As It Wants