Saudi Arabia’s Energy Minister, Khalid Al-Falih, stated that there is no evidence a pact by global oil producers to curb output needs to be adjusted. Al-Falih described the recent weakness in crude prices as an overreaction to statistical glitches, according to Khaleej Times.
Crude prices fell by about 4% during the first week of July after US data showed a surprise 3.3mb rise in crude inventories to 513.2mb.
Al-Falih said “I do not expect the diplomatic and political issues that have surfaced with Qatar to have any impact whatsoever on the oil production agreement,” reported Arab News.
“Time will correct for this statistical glitch that we saw last week,” he said, adding that the results of May’s agreements to extend a global production cut would “materialize over weeks and months”.
It is worth noting that OPEC and other key producers agreed by the end of May to extend the agreement of decreasing the production by almost 1.8mb/d and hold output there until the first quarter of 2018.