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The Emirati Energy Minister is inviting oil and gas majors to make new investments in 2018 after over a $1 trillion in cancelled projects caused thousands of job losses in the industry.
Minister Suhail bin Mohammed Al Mazrouei made the invitation during the Tuesday proceedings of International Petroleum Week in London. Global exploration and production spending fell by 27 percent in 2015 and 2016. "It was also a period that saw major stock builds, with the OECD stock overhang increasing to a level of 380 million barrels above the five-year average at the end of July 2016,” he said.
“Action” is necessary to restart financier interest in discovering new oilfields, the UAE official said. Oil prices have grown since the Organization of Petroleum Exporting Countries agreed to reduce bloc-wide output by 1.2 million barrels per day. That agreement will expire at the end of 2018, provided it lasts beyond a June “review” stipulated in the program’s renewal in November.
The OPEC deal is closer than ever to meeting its market rebalancing goals, with OECD inventories now just 74 million barrels above the five-year average recorded in January 2017, according to a report by Reuters.
There are also roughly a dozen other non-OPEC nations that have pledged to cut 600,000 additional barrels per day, with Russia making half of these additional reductions. The OPEC and the non-OPEC producers will draft a plan for long-term cooperation this year to institutionalize their current collaboration into a supergroup of oil producers led by Saudi Arabia and Russia, Al Mazrouei told The National in an interview published earlier this month. Putting together a draft charter and discussing it during the year is one of the UAE’s aspirations, said the minister whose country is currently holding OPEC’s presidency.
By Zainab Calcuttawala for Oilprice.com
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Zainab Calcuttawala is an American journalist based in Morocco. She completed her undergraduate coursework at the University of Texas at Austin (Hook’em) and reports on…