Qatar oil minister says signs of oil price recovery on horizon
Qatar's oil minister says a new rise in global oil prices is quite possible in 2016 in view of the ongoing recovery in the global economy and subsequent growth in energy demand.
In a statement released on Sunday, the Persian Gulf country’s Energy Minister Mohammed bin Saleh al-Sada, who is also the current acting president of the Organization of the Petroleum Exporting Countries (OPEC), said the oil price has "bottomed out" and he sees signs of recovery for the next year.
The Qatari minister added that the growth in global gross domestic product (GDP) in 2016 is slated to be 3.4 percent compared with an expected 3.1 percent in 2015, noting that this would result in a global oil demand hike by 1.3 -1.5 million barrels per day (bpd), AFP reported.
He noted that growth in oil supplies from non-OPEC producers has substantially reduced in 2015 and is likely to show zero to negative growth in 2016.
"On the other hand, call on OPEC oil is expected to become healthier from 29.3 million bpd in 2015 to 30.5 million bpd in 2016 as indicated by increasing demand from both developed and emerging markets," the official added in his statement.
Sada said current low market prices have spurred oil firms to reduce their capital expenditure by almost 20 percent this year from USD 650 billion, where it stood in 2014.
"This trend of reducing investment in the oil industry could result in production shortfalls down the line," the statement said.
Meanwhile, Venezuela, a major oil producing country, which has been trying hard to persuade other oil producers to cut output to boost prices, said on Thursday that a technical meeting of OPEC and other crude-producing countries is to take place on October 21.
On Friday, global oil prices edged up in New York market but slipped in London as traders booked profits from the week's rally fuelled by hopes for oversupply relief from lower US crude production.
As a result, US benchmark West Texas Intermediate (WTI) for delivery in November rose 20 cents to hit USD 49.63 a barrel on the New York Mercantile Exchange.
During the same day’s trading, Brent North Sea crude for delivery in November fell to USD 52.65 a barrel in London, a loss of 40 cents from Thursday's settlement.
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