Global crude inventories are declining and supply and demand are in balance, according to the head of Saudi Aramco, while the United Arab Emirates energy minister said U.S. shale oil doesn’t threaten OPEC’s efforts to support the market.
Demand for crude is continuing to rise and oil inventories are returning to the levels of the past five years, Aramco Chief Executive Officer Amin Nasser said Sunday in the eastern Saudi city of Dhahran. “This is helping prices improve,” he said, as the Organization of Petroleum Exporting Countries and allied suppliers prepared to gather in Vienna to assess the market.
U.A.E. Energy Minister Suhail Al Mazrouei said he’s optimistic the producers will extend their deal on output cuts when they meet on Nov. 30. Shale oil represents only a fraction of global production and “is not an enemy to OPEC,” he told reporters in Abu Dhabi, referring to the U.S. output that contributed to a worldwide glut.
OPEC and Russia have outlined a deal to extend their oil production limits to the end of next year, though both sides are still working out crucial details, according to people involved in the conversations. The cuts, which took effect in January, will expire in March unless OPEC and its fellow producers extend the historic accord. Participants in the deal collectively pump 60 percent of the world’s oil.