Abu Dhabi's Supreme Petroleum Council has given the go-ahead to the five-year business plan of Abu Dhabi National Oil Company (ADNOC), which envisages the company ramping up its oil production by 400,000 barrels per day to 3.5 million bpd by 2018, UAE's news outlet The National reports.
A couple of months ago, ADNOC said it was committed to achieving its 3.5 million bpd target, depending on market conditions, while undertaking reforms to enhance efficiency.
ADNOC, which says it currently produces 3.15 million bpd, had originally set the target to increase output by 400,000 bpd for the end of 2017, The National reports. Furthermore, ADNOC has left the question open as to whether there might be limits on production in the shorter term, should OPEC clinch a deal on curbing the cartel's total production to the tentative target of 32.5 million bpd-33 million bpd.
UAE - OPEC's fourth-largest producer after Saudi Arabia, Iraq and Iran - pumped in September 2.994 million bpd out of OPEC's total 33.394 million bpd, the organization's secondary-sources data shows. According to what the countries had directly communicated to OPEC, the United Arab Emirates are still number four behind the Saudis, Iraq and Iran, but the production directly reported was 3.186 million bpd in September.
A Gulf ally of Saudi Arabia together with Kuwait, the UAE is expected to cut as part of a potential OPEC deal to stabilize prices, despite its 2017/2018 production goals.
Saudi Arabia's key support for cuts "will come from its Gulf allies of Kuwait and the United Arab Emirates", Bloomberg recently quoted Mike Wittner, global head of oil research at Societe Generale, as saying. According to Bloomberg calculations, the worst case scenario would be that Libya, Nigeria, Iran, Iraq, and Venezuela get an exemption and increase production, causing the remaining OPEC members to cut 10 percent of output, which places the UAE with a nearly 300,000-bpd cut.
And while OPEC is trying to negotiate a deal, UAE Energy Minister Suhail Mohammed Al Mazrouei has recently called non-OPEC oil producers, even US shale, to join the fight.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. More