El-Badri: OPEC Willing to Work with Non-OPEC Producers
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At the annual IHS CERAWeek conference in Houston, El-Badri also said the current oil cycle is facing a supply problem that could last for years unless a solution is found. Despite a more than 6 percent surge in spot prices on Monday, oversupply has dragged down crude by nearly 50 percent over the last year, and U.S. crude has dropped nearly 20 percent this year.
“The United States want to export, but at the same time they import and store,” he said. “This is something that I don’t know how we’re going to tackle it.”
El-Badri made his remarks after oil prices surged on a report from the International Energy Agency. The agency said that U.S. shale production was expected to fall by 600,000 barrels per day this year.
This fed into data released late last week that showed U.S. drilling rig numbers had fallen to the lowest level since December 2009.
El-Badri also said he supported the idea of a production freeze. “The first step is to freeze the production. Maybe if this is successful we can take other steps in the future,” he said. “I think this is a first step to see what we can achieve,”
Last week, Saudi Arabia and Russia said they had agreed to an oil production output freeze, But while Iranian Oil Minister Bijan Zanganeh welcomed the plan, he fell short of committing to it and Iranian sources told Reuters that capping output is not enough to rebalance the market.
Oil prices have fallen sharply this year, weighed by persistent oversupply concerns.
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