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S. Arabia believes oil market can absorb high prices

JEDDAH, Oil markets can bear hike of crude oil prices, said Saudi Minister of Energy Khaled Al-Faleh on Friday.

OPEC and non-OPEC oil producers’ abidance by the deal to cut the crude output is in the range of 145 percent, said the minister at a news conference.

He was speaking after a meeting of a panel of OPEC and non-OPEC producers, which meets once every two months to review market conditions and producers’ commitment to the accord, worked out in late 2016 to slash output by 1.8 million barrels per day and tackle the market glut.

Bullish crude prices have been widely attributed to the producers’ agreement to trim the production.

Oil reserves have dropped by 300 million barrels since January 2017, when the agreement was reached, Al-Faleh indicated.

Although the rates are currently in the range of USD 70 per barrel, the minister warned against unsteady prices.

Al-Faleh has expressed his belief that the markets can absorb higher oil prices, however he stressed that the prices are determined by market mechanisms.

He indicated that the producers would re-examine the reserves at the next panel meeting, due in Vienna in June.

Source: Kuwait News Agency