OPEC+, including Russia, to come up with new agreement: Riyadh

Riyadh: Saudi Arabia's Energy Minister Prince Abdulaziz bin Salman informed that the Kingdom's administration is expecting to brew up an agreement with OPEC+, including Russia, Arab News reported.

According to the minister, politics should be kept outside OPEC+, and the value of the alliance of oil producers deserves global appreciation.

While a set of OPEC+ production quotas that came into force in April 2020 expires in three months, oil prices are soaring at a record high in a decade. The minister told Financial Times that it is too early to brief the nature of the new agreement as the oil market is in uncertainties at present. But he hinted that OPEC+ might step up oil production if demand increases.

Arab News quotes Prince Abdulaziz from the interview, "With the havoc you see now, it's too premature to try to pinpoint (an agreement). But what we know is what we have succeeded in delivering is sufficient for people to say so far there is a merit, there is a value of being there, working together."

In 2020, OPEC+ stood within the agreement as members raised total production each month by 430,000 barrels a day. But after the start of the Russia-Ukraine war, Russia fell short in production, from nearly 11 million barrels per day in March to 10 million barrels per day in April.

Further, the Saudi minister blamed a lack of global refining capacity and taxes for oil price hikes. He said that in the last three years, the world lost nearly 4 million barrels of refining capacity and 2.7 million out of them after the Covid-19 outbreak.

He said that the OPEC+ alliance would bring unform adjustments in the future as there are uncertainties due to Covid-19 lockdowns in China, global growth and supply chains. To untie bottlenecks in production and refinery capacity, governments must encourage the industry to invest in hydrocarbons, though the world is switching to cleaner energy sources.