Saudi Arabia and the United Arab Emirates are urging key producers to reduce their investment in fossil fuels and trade oil, diesel and natural gas at record highs on May 10 in all energy sectors. Warned that the reserve energy capacity is decreasing.
Brent crude was trading at about $ 102 per barrel as of the afternoon of May 10.
“I’m a dinosaur, but I’ve never seen these things,” Saudi Arabia’s Minister of Energy, Prince Abdul Aziz bin Salman, told Bloomberg on May 10 at an OPEC meeting in Abu Dhabi.
The prince mentioned the soaring prices of refined oil products in the United States, especially in the United States, where gas and diesel prices hit record highs, causing problems for the Biden administration.
“The world needs to awaken to existing reality. The world is running out of energy capacity at all levels,” said the Saudi Minister.
United Arab Emirates Energy Minister Suhail al-Mazulowei told Bloomberg at the same conference that OPEC + would have enough oil for its customers without additional global investment as the global economy fully recovers from the pandemic. He said the supply could not be guaranteed.
“We have warned of a lack of investment,” said Al Mazulowei, and “the lack of investment is catching up with many countries.”
The ministers also counterattacked a new US parliamentary bill aimed at regulating energy output for oil cartels, arguing that the bill would bring great turmoil to the already tense energy market.
Of the major producers, Saudi Arabia and the United Arab Emirates are one of the few producers investing in more production, producing 2 million barrels of crude oil per day by the end of the last decade. We are spending billions of dollars to improve our capabilities.
Other producers are struggling to invest as Western shareholders and governments are driving the transition from fossil fuels to “green” energy.
OPEC + announced an increase of 432,000 barrels per day in June at its May 5 meeting, but struggling to reach its monthly target as many members are producing below quota. doing.
According to the latest OPEC + survey by S & P Global Commodity Insight, energy alliances in 23 countries fell below the production quota of 2.59 million barrels per day in April.
The Minister of the United Arab Emirates believes that there is no serious market crisis at this time and OPEC has little urgency to boost oil production.
However, some major importers, especially the EU, US, and Japan, which have demanded a more rapid increase in production from OPEC + since last year, do not agree.
The same countries simultaneously imposed sanctions on Russia, a key member of OPEC, after invading Ukraine at the end of February.
The EU recently announced this month that it will further ban Russia’s energy imports.
Crude oil prices have risen more than 35% this year to a high of about $ 105 per barrel since sanctions were taken in Moscow over Ukraine.
G7 countries lobbyed OPEC + to punish Russia, but Saudi Arabia and the United Arab Emirates reiterated that the cartel did not allow geopolitics to influence its decision.
Al Mazulowei has declared that the politicization of the oil market has blamed the recent rise in prices, unified OPEC +, and promised that all members will not increase output on their own.
“We are together,” he said. “Believe me. You can’t unilaterally increase production unless you intend to break the alliance,” said the UAE Minister.
“We get only a small portion of what businesses and governments make from those additional taxes,” he said.
The minister said it was a mistake to blame oil producers, and that high taxes in consuming countries blame rising fuel prices.
He also told CNBC that the revival of the bill proposed in Washington could push oil prices up by as much as 300 percent.
TOPEC ministers have opposed new US legislation aimed at regulating oil production, saying OPEC has unfairly targeted the energy crisis and such efforts would disrupt the energy markets.
The U.S. Senate approved a new bipartisan No Oil Producing and Export Cartel (NOPEC) bill on May 5 with a 17-4 majority, the first step towards passing the proposal decades ago. ..
The Senate and House of Representatives now need to pass before the president can sign the law.
The proposed bill aims to protect U.S. consumers and businesses in manipulating energy prices, and the U.S. government has filed an antitrust lawsuit against OPEC on global oil supply and most control of prices. It will make it possible to wake up.
“If you interfere with that system, you need to monitor what you’re looking for, because a chaotic market raises prices that the world can’t handle by 200% or 300%,” said CNBC’s Al Mazrouei. Mr. says. World Utility Conference in Abu Dhabi.
“We OPEC + cannot fully indemnify all of the world’s requirements,” he said.
“How much we produce is our share. And in reality, we must be doing more.”
The United Arab Emirates and Saudi Arabia’s Energy Ministers issued a joint statement stating that both OPEC and non-OPEC members should work together to address the ongoing energy crisis.
“I am very worried about the overall energy system that exists today. The world needs to work jointly, responsibly and comprehensively to provide us and save the global economy. “Prince Bin Salman said.
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Brian S. Jung is from New York City and is a resident with a background in the political and legal industry. He graduated from Binghamton University.