Join +750K new investors every month who copy stock picks from billionaire's portfoliosSign Up Free

IEA chief says he hopes OPEC+ will address 'artificial' supply gap

Published 24/11/2021, 14:22
© Reuters. FILE PHOTO: A gas pump is seen hanging from the ceiling at a petrol station in Seoul June 27, 2011. REUTERS/Jo Yong-Hak/File Photo
GPSI34
-

By Noah Browning and Shadia Nasralla

LONDON (Reuters) -The head of the International Energy Agency Fatih Birol said on Wednesday oil markets are suffering from an artificial supply gap, and that he hopes OPEC+ producer countries will do more to bring down prices at an upcoming meeting.

"(A) factor I would like to underline that caused these high prices is the position of some of the major oil and gas suppliers," Birol said in an online presentation. "Some of the countries did not take, in our view, a helpful position in this context."

"Some of the key strains in today's markets may be considered artificial tightness... because in oil markets today we see close to 6 million barrels per day in spare production capacity lies with the key producers, OPEC+ countries."

OPEC+ - the Organization of the Petroleum Exporting Countries (OPEC), Russia and their allies - has ignored calls by the United States and some other consumers to pump more.

Birol said he hoped that when the producer club meets on Dec. 2 to discuss policy it would "make the necessary steps in order to comfort the global oil markets and help to bring the prices down to reasonable levels".

Russia can "easily" increase its gas exports to Europe by about 15% to ease a supply and price pinch there, Birol added.

Birol said that while the IEA understands the rationale behind a coordinated release of oil storage led by the U.S. and other top consumers this week to cool prices, the Paris-based agency only responds collectively to major supply disruptions.

© Reuters. FILE PHOTO: A gas station attendant pumps fuel into a customer's car at the NNPC Mega petrol station in Abuja, Nigeria March 19, 2020. REUTERS/Afolabi Sotunde/File Photo

The administration of U.S. President Joe Biden announced on Tuesday it would release millions of barrels of oil from strategic reserves in coordination with China, India, South Korea, Japan and Britain.

"We see where they are coming from," Birol said, but added: "This is not an IEA collective response, I want to make this clear. The IEA collective response system is in place in case of a major oil supply disruption."

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.