For the Chinese 2018 is the year of the dog, but for UAE Energy Minister Suhail al- Mazrouei 2018 will be “the year of fully correcting the market.”
Mr Mazrouei, beginning his one-year term as Opec president, told the Gulf Intelligence UAE Energy Forum on 11 January that Opec is committed to another “full year” of cuts in accordance with November’s agreement (##764##).
For sure, Opec last year secured its first annual output fall since 2014: production averaged 32.49mn b/d. However, the big caveat is that this was just 130,000 b/d shy of 2016’s record 32.62mn b/d and the second highest on record. That said, the cut was implemented despite Iran, Libya and Nigeria all chalking up sizeable production gains as they bounced back from geopolitical outages.
The two driving factors for the fall were Saudi Arabia cutting deeper than its obligations, and involuntary falls...