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Opec to consider PM Narendra Modi's view before output cut

Fadu News 2018-12-07 08:00:00

Prime Minister Narendra ModiPrime Minister Narendra Modi , Reuters

Prime Minister Narendra Modi's efforts to bring down the oil prices are being taken into consideration by oil producing nations of Organisation of Petroleum Exporting Countries (Opec).

The oil producers' cartel will consider Modi's with seriousness before taking a decision on cutting output to support falling prices, Saudi oil minister Khalid Al-Falih said Thursday.

Speaking to reporters after the Opec meet, Al-Falih said, "We take the views of Prime Minister Narendra Modi seriously who is equally vocal about the issue. We just met him in Buenos Aires (during G20 summit) and privately he made those points very strongly that he does care for Indian consumers and is very serious about it. I have also seen him at three times at various energy events in India where he was very vocal."

India has been raising the issue of volatile oil prices during its meet with oil producing countries especially Saudi Arabia. It was one of the key issues India raised at the recently concluded 13th G20 Summit in Argentina.

"Consumer is a very important part of our deliberation even though they are not physically with us in the room," Al-Falih said.

Opec is said to have tentatively agreed to an oil-output cut on Thursday but was waiting to hear from non-Opec heavyweight Russia before deciding the exact volumes for a production reduction aimed at propping up crude prices, the reports said.

Al-Falih said that going by the supply-demand, Opec believes that there is substantial volumes out there as a result of release in spare capacity that need to be withdrawn. "We hope that we will come to an agreement where all producers will contribute with equal cuts across the board. "So far from my consultations with colleagues we have not reached that," he said.

Asked whether Opec could fail to reach a deal, Al-Falih said all options were on the table. Possible output cuts by Opec and its allies ranged from 0.5-1.5 million barrels per day (bpd), and 1 million bpd was acceptable, he said.

Al-Falih said that US will not benefit from an oversupply market from an extended period of time where investment flow start and fantastic growth in US shale brought to a halt as the way it happened in 2015-16.

Opec delegates have said the group and its allies could cut by 1 million bpd if Russia contributed 150,000 bpd of that reduction. If Russia contributed around 250,000 bpd, the overall cut could exceed 1.3 million bpd.

(With inputs from Reuters)