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Prince Abdulaziz to maintain

caution on production

SAUDI ARABIA SAUDI Energy Minister and de-facto OPEC+ It added: “The Members of the JMMC reaf-
kingpin Prince Abdulziz bin Salman Al Saud firmed their commitment to the DoC which
said this week he would continue to be cautious extends to the end of 2023 as agreed in the
about increasing oil production. This comes 33rd OPEC and non-OPEC Ministerial Meet-
despite increased optimism among bankers and ing (ONOMM) on 5th of October 2022, and
analysts that growing demand could lead to a urged all participating countries to achieve full
rapid increase in the oil price with OPEC+ not conformity and adhere to the compensation
deviating from its recent restraint. mechanism.”
“I will believe it when I see it and then act,” The October deal saw OPEC reduce its allo-
Prince Abdulaziz said during a discussion with cated production level from 26.7mn bpd by a
energy historian and S&P Global vice chairman ‘voluntary adjustment’ of 1.27mn bpd to 25.4mn
Daniel Yergin. bpd, while its non-OPEC partners cut by just
Following the announcement that OPEC+ over 700,000 bpd. Saudi Arabia and Russia each
would continue to stick to the level agreed when made a voluntary cut of 526,000 bpd, though
it reduced quotas by 2mn barrels per day (bpd) in reality, Russian production had already been
in October, the minister said the group’s action hampered by a shrinking market for its crude
had been vindicated despite high-profile, though following Western restrictions on purchases.
brief, tensions with the US which continues to The theoretical withholding of crude produc-
lobby for lower prices. tion by OPEC+ has led banks including Gold-
The October announcement led to a jump the man Sachs and Morgan Stanley to forecast Brent
price of crude. “If people had trusted us at the prices in excess of $100 per barrel during Q3
time, we wouldn’t have gone through the fears owing to reduced inventories.
that happened.” he said. Meanwhile, Prince Abdulaziz cautioned
OPEC’s Joint Ministerial Monitoring Com- against sanctioning energy producers, suggest-
mittee (JMMC) met on February 1, after which ing that these would come back to haunt con-
it said: “The Committee reviewed the crude oil sumer nations that depend on major import
production data for the months of November volumes.
and December 2022 and noted the overall con- “All these sanctions, embargoes, they’re all
formity for participating OPEC and non-OPEC going to curl up into one thing and one thing
countries of the Declaration of Cooperation only: lack of energy supply of any kind when it’s
(DoC).” most needed. That is my concern,” he said.™

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