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OPEC+ agrees to deepen cuts
POLICY
DURING last week’s meeting in Vienna, OPEC members and their non-OPEC partners agreed to reduce combined output by an additional 500,000 barrels per day during the first quarter of 2020. This takes their collaborative cut to 1.7mn bpd, around 1.7% of worldwide production.
The market received a boost when the group announced a surprise voluntary addition to the cuts from “mainly Saudi Arabia”, bringing the total reduction to more than 2.1mn bpd.
The group did not agree to extend the cuts beyond March despite calls to lengthen until June or December amid fears of economic slow- down from member states, but Iraqi Oil Minister Thamer al-Ghadban said that an extraordinary meeting would be held in March.
Announcement of the agreement came from Russian Energy Minister Alexander Novak, who told gathered press: “We really do see some risks of oversupply in the first quarter due to lower seasonal demand for refined products and for crude oil.”
He added that the details of the deal and the distribution of cuts would still need to be ratified. The announcement came after six hours of talks on December 5, after which, Kuwait’s Oil Minister Khaled al-Fadhel would not provide any details and his Saudi counterpart Prince Abdulaziz bin Sal- man said that no deal could be confirmed until the OPEC and non-OPEC groups OPEC could not say it had an agreement until it met with non-OPEC
producers on Friday.
Reuters quoted sources as saying that the lat-
est deal was a compromise between Russia and Saudi, with Moscow not having been keen to deepen the cuts and Riyadh supportive of cutting further and extending the agreement.
While Saudi has claimed to the contrary, Riyadh’s desire for deeper cuts is seen emanat- ing from intention to support the initial public offering of state oil firm Saudi Aramco, which last week raised $25.6bn, making it the largest ever listing ahead of trading beginning later in December.™
SOUTH ASIA
India continues campaign to expand gas consumption
PROJECTS & COMPANIES
INDIA’S efforts to expand the use of natural gas within the country’s primary energy mix continued this week with the opening of the country’s first liq- uefied natural gas (LNG) dispensing station.
INOX India said this week that it had com- missioned the facility at Petronet LNG’s import terminal in Dahej, which is in Gujarat State. The new unit will dispense fuel to buses that will be responsible for transporting Petronet LNG’s staff between the terminal and the town of Bharuch.
Commenting on the station’s launch, INOX India CEO said the company aimed to com- mission another 25 LNG and liquefied-to-com- pressed natural gas (LCNG) stations over the next two years.
The station’s commissioning comes as India looks to increase its use of gas to help reduce its reliance on dirtier fuels such as crude oil and coal. The country has set a target of gas account- ing for 15% of its primary energy mix by 2030,
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w w w . N E W S B A S E . c o m Week 49 11•December•2019