The United Arab Emirates, UAE Minister of Energy and Industry Suhail Al Mazrouei says demand for oil would likely increase in 2020, as the global economy is recovering due to ease in trade tension between the United States and China.
Addressing the Atlantic Council’s Global Energy Forum in Abu Dhabi on Saturday, Mazrouei said demand for oil will be healthy in 2020, expressing concern about how to forecast supply.
“I am not worried about demand but the issue is how do we forecast supply. On demand, we are at a better position in 2020 than in 2019 as trade tensions between the US and China is easing.”
“I am worried about the lack of supply in the longer run as investors are not investing or an over-supply in the short term the role of US production is very crucial in the short term period,” Bloomberg quoted him as saying.
He also hoped the next meeting of the Organisation of Petroleum Exporting Countries, OPEC+ Alliance in March will come up with a “good decision” to keep the market balanced.
OPEC+ Alliance includes members of the OPEC and non-OPEC countries.
In December 2019, the group held a meeting in Vienna during which its members agreed to deepen supply cuts from 1.2 million barrels per day (mbpd) to 1.7 mbpd for the first quarter of 2020.
“All countries in OPEC+ are committed not to raise prices but to deliver balance and ensure the world is well-supplied,” the minister said, stressing that Russia was fully committed the group’s agreement and hoping to continue cooperation with the country in the future.
Mazrouei further noted that the UAE was heavily investing to ensure its energy resources were well secured. “We are in a very good position to secure ourselves and keep securing our customers needs,” he said.
UAE Minister of State Sultan al-Jaber, the chief executive of Abu Dhabi National Oil Company (ADNOC), pointed to the calmness of geopolitical tensions over the past few days.
He said wisdom, balance and diplomacy seem to master the situation today.
“The global economy is going into 2020 in better shape than last year,” he noted.
In light of the ease in trade tensions, indications of the return of growth in the industrial sector and the high level of consumer agreement, “we can look to the future with cautious optimism.”
Jaber also discussed the effects of these economic trends on energy demand, reviewing his country and ADNOC’s flexible response methodology and keeping pace with rapid changes taking place in the global energy sector.