OPEC+ alliance gets more backing from oil ministers on production cuts

The UAE joined Iraq, OPEC's secretary general and other oil producers in backing the OPEC+ alliance's decision to cut crude oil production quotas by 2 million b/d starting in November, after claims by the US that some producers were under pressure to back the decision led by Saudi Arabia.

"I would like to clarify that the latest OPEC+ decision, which was unanimously approved was a pure technical decision, with no political intentions whatsoever," UAE energy minister Suhail al Mazrouei said in an Oct. 17 tweet. Iraq's state marketer SOMO said on its website that it had received press inquiries about the "results and consequences" of the OPEC+ cut. "The decisions of OPEC+ are based on readings and economic indicators and in an objective professional manner, and the decision is taken unanimously," it said.

Since the OPEC+ decision on Oct. 5, Dated Brent peaked at $98.775/b on Oct. 7 and was down to $92.875 on Oct. 14, according to Platts assessments by S&P Global Commodity Insights.

Kuwait Petroleum Corp.'s CEO Nawaf al-Sabah said that an expected slowdown in global economic growth and increasing economic risks were leading to a growing imbalance between supply and demand in the oil markets, according to a Oct. 16 statement on the official state-run KUNA news agency.

Saudi Arabia has been taking fire from the US since the OPEC+ alliance, which the country co-chairs with Russia, agreed Oct. 5 to slash quotas by 2 million b/d from November, at a time when many forecasters are expecting oil demand to rise.

In an Oct. 13 statement, White House spokesperson John Kirby said some OPEC members had privately told the US they felt pressured into agreeing with the deal.

Saudi Arabia's defense minister Khalid bin Salman said on Twitter over the weekend: "Although the OPEC+ decision, which was taken unanimously, was due to purely economic reasons, some accused the kingdom of standing with Russia," he said. "Iran is also a member of OPEC, does this mean that the kingdom is standing with Iran as well." The OPEC+ cut was "the right decision" and made at the right time, the secretary general of the Organization of Arab Oil Countries, which includes Bahrain, Qatar, Egypt and Kuwait, said in an Oct. 15 statement.

US President Joe Biden has vowed to impose "consequences" for the decision, with a so-called NOPEC bill that would allow antitrust lawsuits against the producer group among the options being weighed by Congress.

"The decision to cut production came after reviewing the economic performance and has nothing to do with politics," Haitham al-Ghais, OPEC's secretary-general, said, according to a KUNA statement on Oct. 17. The OPEC+ decision on Oct. 5 was unanimous, he added. Ghais noted OPEC+ support from Algeria, where Ghais was visiting.