"In June, when we (OPEC and allied producers) met, there was this common understanding that perhaps six months since January are not enough (time) to assess the cut that we have introduced and we need two more months," Thamer Ghadhban said on Wednesday. "That's why this meeting is going to be held tomorrow, to see should we continue with this cut or should we introduce a deeper cut," he added. "It's not a unilateral decision, it is a common decision."
The Organization of the Petroleum Exporting Countries and allied producers led by Russia, a grouping known as OPEC+, agreed last year to cut global crude supply to support prices and balance the market. "If you go back to the deliberation in November last year ... there were two alternatives of 1.6 and 1.8 million barrels per day," Ghadhban said.
"But there was resistance by some members and that's why we agreed on 1.2 million barrels per day." Benchmark Brent oil prices have fallen to around $60 per barrel in recent weeks from their 2019 peaks of $75 as worries about a slowing global economy outweigh supply disruptions from sanctions-hit Iran and Venezuela.
Market players are concerned that a U.S.-China trade war could push oil demand growth below 1% for the first time in years. Saudi Arabia's new energy minister, Prince Abdulaziz bin Salman, downplayed such worries this week, saying demand would pick up once the trade threat dissipated.
Ghadhban, whose country is the second-biggest oil producer in OPEC after Saudi Arabia, said he would meet the Saudi and Russian energy ministers later on Wednesday. As for Iraq's production, Ghadhban said the Kurdish region should respect its obligations regarding oil exports and its share in the federal budget. The Kurdish Regional Government is supposed to give 250,000 barrels per day of oil to the federal government but is so far not complying, he said.
He also said Iraq would continue to import gas from Iran, and that there was little likelihood of reopening an oil export pipeline through Saudi Arabia. Ghadhban, speaking at the World Energy Congress in Abu Dhabi, said Iraq aimed to explore for gas in its western desert as the area had "huge potential".
Iraq had also signed a contract with a Russian firm for a gas exploration block, he said. The OPEC+ joint ministerial monitoring committee, known as JMMC, will meet on Thursday in Abu Dhabi on the sidelines of the energy conference.
(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)