Kuwait City, Kuwait | – OPEC has no choice but to keep its market share and shun oil output cuts, Kuwait’s oil minister said on Thursday, reiterating the view from the emirate that the group will hold its course when it meets next in June.
“Of course we are concerned because the price of oil will affect our budget … within OPEC we don’t have any other choice than keeping the ceiling of production as it is because we don’t want to lose our share in the market,” Ali al-Omair told reporters in Kuwait city.
Many OPEC oil ministers, including Saudi Arabia’s Ali al-Naimi, have defended the group’s November decision not to cut production but instead defend market share and curtail the output of more expensive producers such as the United States. The accord pushed oil prices below $50 per barrel, extending a sharp decline that began in June amid a global glut of crude and weakening demand.
Since the oil price collapse, OPEC officials have said they wanted non-OPEC producers to cooperate with the group but those attempts have made little progress. “If there is any type of arrangement with (countries) outside OPEC, we will be very happy,” Omair said on Thursday, without elaborating.
Oil prices have recovered slightly since to over $60 a barrel, but have fell again over the past days. Brent crude for May delivery fell towards $55 a barrel on Thursday following a bigger than expected crude stock build in the United States that fuelled concerns of an oversupply in the world’s largest oil consumer.
Omair said he expected higher prices by the end of the year. “There are indications that at end of 2015 the economic growth rates will improve and this would make the prices improve,” he said. OPEC has said it believes oversupply, as much as 1.5 million barrels per day, will evaporate as oil demand picks up and U.S. oil production growth slows. However, should U.S. oil producers prove more resilient than OPEC expects, the glut could persist and grow if Western powers and Iran reach a nuclear deal allowing Tehran to increase its oil exports.