Saudi Arabia sees global oil market rebalancing by April

New Delhi, Feb 20 (IANS) Both OPEC and non-OPEC oil producers hope that the global crude market will get balanced by coming April following the latest production cuts being implemented since last month, Saudi Arabia's Energy Minister Khalid Al-Falih said on Wednesday.

Following a prolonged period of price slump owing to a supply glut, the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC producers decided in December to lower their production of crude oil by 1.2 million barrels per day for a six-month period. The output cut decision, which was spearheaded by Russia, came into effect on January 1.

"We are hopeful that the market will get balanced by April, when we will be able to take stock of where we are," Al-Falih told reporters on the sidelines of the Saudi India Forum here organised by the Saudi General Investment Authority in partnership with the Confederation of Indian Industry (CII). The forum has been organised as part of the events related to Saudi Crown Prince Mohammed bin Salman's onging official visit to India.

The Saudi Minister for Energy, Industry and Mineral Resources said by April, the oil producers would be able to understand if the market has rebalanced closer to the five-year average inventory levels. Global oil price levels started rising again last month after falling sharply over the last quarter of 2018.

"Some producers, who have been slow in implementing their quota of production cut targets, will catch up by that time (April)," Al-Falih said.

"Based on where we are in April on our production agreement for January to June (2019), we will talk with other producers on the future course of action," he added.

India, which is a major consumer of imported oil, has repeatedly urged producers for "responsible pricing" that takes into account the interests of both producing and consuming countries.