OPEC's El-Badri urges IEA to end release of oil

Eric Watkins
OGJ Oil Diplomacy Editor

LOS ANGELES, June 28 -- Abdullah El-Badri, secretary general of the Organization of the Petroleum Exporting Countries, urged the International Energy Agency to reverse its earlier decision to release 60 million bbl of oil over the coming 30 days.

“I hope this practice will be stopped and stopped immediately,” El-Badri told a news conference in Vienna after the scheduled 8th ministerial-level meeting of the energy dialogue between OPEC and the European Union.

“We don't see a good reason to release this quantity, and I hope the IEA will refrain from using this practice,” El-Badry said, also telling the Kuwait News Agency that IEA had wronged OPEC with its decision to release the oil.

"The agency did not give OPEC an opportunity to increase its output before deciding to draw from the strategic reserves of its 28 members," he said, noting that such a move is justifiable only as “a final resort in extreme emergencies” and not to control prices.

“As international organizations, IEA, which represents the interests of consumers, and OPEC, which represents producers, have to work together for the stability of the market and to maintain fair prices,” El-Badri said.

His remarks were in line with those of Iran’s OPEC Gov. Mohammad Ali Khatibi who blasted the IEA’s decision to release the strategic reserves as a politically motivated intervention in “the ordinary function” of the oil market.

“Following the failure to bring down the prices at 159th ministerial meeting of OPEC in June 8, the US and Europe are using all the means to push oil prices lower,” he said ahead of the meeting with the EU.

Tamas Fellegi, president of the EU's energy council and also Hungary's development minister, said there is “obviously” a disagreement on the issue of the IEA’s decision.

"Even if the IEA made this action, it has to remain extraordinary and limited in time, this is very important, and should not undermine the cooperation between the EU and OPEC and should not disrupt the market mechanisms," Fellegi said.

That view matched remarks by IEA Executive Director Nobuo Tanaka, who told reporters in London the agency took its decision as a short-term measure to ensure the availability of supplies while awaiting a production increase by Saudi Arabia.

“We are simply saying we will just fill the gap before OPEC or Saudi is going to produce supplies for the market,” said Tanaka. "We are just filling the gap—we can't continue forever."

Tanaka expressed confidence that Saudi Arabia—which he said has “about 3 million b/d of spare capacity”—would produce more, as it had pledged, but that the extra supplies might take "a couple of weeks" to reach the market.

"We are very sure this tightening of the market will happen in July, August when refinery maintenance is over," said Tanaka, who repeated that the current stocks release was for 30 days after which the agency would reassess the market.

Kuwait’s Minister of Oil Mohammad al-Busairy shared Tanaka’s view of tightening supplies and said the global oil market will be in “dire need” for some 2 million b/d of oil during the third quarter, with demand falling to around 1.5 million b/d in the last quarter of the year.

Noting Saudi Arabia, Kuwait, and the UAE alone have the necessary spare capacity to meet the growing demand, al-Busairy said his country should take advantage of the situation while prices are high.

“We should not miss such opportunity, particularly under the soaring prices, and the increasing demand in the market, and we have the ability to meet such demand,” al-Busairy said, adding, “This is an output policy in the interest of our country, and we are following it."

OPEC has not officially issued a statement concerning IEA’s decision to release oil from its reserves.

Contact Eric Watkins at hippalus@yahoo.com.

Related Articles

PBF Energy, PBF Logistics make management changes

12/12/2014 Matthew Lucey, currently executive vice-president of PBF Energy Inc., will succeed Michael Gayda as the company’s president. Todd O’Malley, current...

Repairs under way at ORPIC’s Muscat refinery

12/11/2014 Oman Oil Refineries & Petroleum Industries Co. (ORPIC) said it plans to resume operations at its 106,000-b/d Mina Al Fahal refinery near Muscat...

Phillips 66 advances plans for splitter at Sweeny refinery

12/11/2014 Phillips 66 has filed an application with state regulators for a permit to build a condensate splitter at its 247,000-b/d Sweeny refinery in Old Oc...

Samref wraps Yanbu refinery revamp

12/11/2014 Saudi Aramco-Mobil Refinery Co. Ltd. (Samref), a 50-50 joint venture of Saudi Aramco and ExxonMobil Corp. subsidiary Mobil Yanbu Refining Co. Inc.,...

BPCL adds petrochemicals to Kochi refinery expansion

12/09/2014 Bharat Petroleum Corp. Ltd. (BPCL), Mumbai, plans to diversify into petrochemicals production as part of the ongoing integrated expansion and upgra...

Moody's: E&P spending to dip as crude oil prices slide

12/08/2014 Weakening crude oil prices will cut exploration and production spending by independent producers in the US next year and make integrated oil and ga...

Firms' third-quarter earnings climbed amid lower crude oil prices

12/08/2014 A sample of 58 oil and gas producers and refiners based in the US recorded a combined 38% jump in profits for this year's third quarter compared wi...

Reliance expands desalination plant at Jamnagar refinery

12/05/2014 Reliance Industries Ltd. (RIL), Mumbai, is scheduled to receive proprietary PX technology from Energy Recovery Inc., San Leandro, Calif., as part o...

Start-up continues at Abreu e Lima refinery

12/05/2014 Petroleo Brasileiro SA (Petrobras) has initiated the start-up of furnaces in the atmospheric distillation unit at its Abreu e Lima refinery (Rnest)...

White Papers

AVEVA NET Accesses and Manages the Digital Asset

Global demand for new process plants, power plants and infrastructure is increasing steadily with the ...
Sponsored by

AVEVA’s Approach for the Digital Asset

To meet the requirements for leaner project execution and more efficient operations while transferring...
Sponsored by

Diversification - the technology aspects

In tough times, businesses seek to diversify into adjacent markets or to apply their skills and resour...
Sponsored by

Engineering & Design for Lean Construction

Modern marketing rhetoric claims that, in order to cut out expensive costs and reduce risks during the...
Sponsored by

Object Lessons - Why control of engineering design at the object level is essential for efficient project execution

Whatever the task, there is usually only one way to do it right and many more to do it wrong. In the c...
Sponsored by

Plant Design for Lean Construction - at your fingertips

One area which can provide improvements to the adoption of Lean principles is the application of mobil...
Sponsored by

How to Keep Your Mud System Vibrator Hose from Getting Hammered to Death

To prevent the vibrating hoses on your oilfield mud circulation systems from failing, you must examine...
Sponsored by

Duty of Care

Good corporate social responsibility means implementing effective workplace health and safety measures...
Sponsored by

Available Webcasts


On Demand

Optimizing your asset management practices to mitigate the effects of a down market

Thu, Dec 11, 2014

The oil and gas market is in constant flux, and as the price of BOE (Barrel of Oil Equivalent) goes down it is increasingly important to optimize your asset management strategy to stay afloat.  Attend this webinar to learn how developing a solid asset management plan can help your company mitigate costs in any market.

register:WEBCAST


Parylene Conformal Coatings for the Oil & Gas Industry

Thu, Nov 20, 2014

In this concise 30-minute webinar, participants have an opportunity to learn more about how Parylene coatings are applied, their features, and the value they add to devices and components.

register:WEBCAST


Utilizing Predictive Analytics to Optimize Productivity in Oil & Gas Operations

Tue, Nov 18, 2014

Join IBM on Tuesday, November 18 @ 1pm CST to explore how Predictive Analytics can help your organization maximize productivity, operational performance & associated processes to drive enterprise wide productivity and profitability.

register:WEBCAST


US HYDROCARBON EXPORTS Part 3 — LNG

Fri, Nov 14, 2014

US LNG Exports, the third in a trilogy of webcasts focusing on the broad topic of US Hydrocarbon Exports.

A discussion of the problems and potential for the export of US-produced liquefied natural gas.

These and other topics will be discussed, with the latest thoughts on U.S. LNG export policy.

register:WEBCAST


Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected