Abu Dhabi — OPEC and its 10 non-OPEC partners would need to cut 1 million b/d from October oil production levels to avoid a supply glut in early 2019, according to the group's analysis, Saudi energy minister Khalid al-Falih said Monday.
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But because market conditions could change by the time the coalition meets December 6-7 in Vienna, a key monitoring committee that met Sunday did not recommend specific cuts, he said.
"We are going to be flexible," Falih said at the ADIPEC conference in Abu Dhabi, a day after co-chairing the OPEC/non-OPEC monitoring committee meeting. "There are a lot of assumptions that may change in two to three weeks time."
But, he added, OPEC and its partners "will do what it takes" to keep the market balanced, with Saudi Arabia leading the way but cutting its crude exports by about 500,000 b/d in December.
The committee said Sunday that the coalition would need to consider a new strategy to maintain market balance, including reversing the 1 million b/d production increase agreed in June.
"Saudi Arabia does not arbitrarily cut," Falih said. "In December, as volumes [from other producers] came plentifully, I think customers are stopping the need to build inventories. Their demand in December declined by over half a million [b/d] compared to November. We happily obliged because we don't want to see inventories build up."
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