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OPEC Sec Gen: lack of investments could lead to volatility
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Says OPEC+ does not target prices, focuses on fundamentals
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OPEC and IEA have jousted for months over outlooks
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OPEC+ dropped IEA as a source for market data last year
(Adds details, oil price)
By Maha El Dahan
DUBAI, April 27 (Reuters) - OPEC Secretary General
Haitham Al Ghais said on Thursday the International Energy
Agency (IEA) should be "very careful" about discouraging
investment in the oil industry, which was vital for global
economic growth.
Such comments could lead to oil market volatility in
future, he said.
Al Ghais also said that the Organization of the Petroleum Exporting Countries (OPEC) and its allies including Russia, a group known as OPEC+, were not targeting oil prices but focusing on market fundamentals. Finger pointing and misrepresenting the actions of the oil exporters and their allies was "counter-productive", he said. Fatih Birol, executive director of the International Energy Agency, has been critical of the OPEC+ group's announcement earlier this month of production cuts of 1.66 million barrels per day (bpd) from May until the end of 2023. Oil prices rose above $80 a barrel on the back of the decision, having fallen as low as $70 per barrel last month. Brent crude was trading at $77.99 a barrel at 0947 GMT, while U.S. West Texas Intermediate crude was at $74.52. Birol, in an interview with Bloomberg on Wednesday, said OPEC should be careful about pushing oil prices up as that would translate into a weaker global economy.
On Thursday, Al Ghais said blaming oil for inflation was "erroneous and technically incorrect" and that the IEA's repeated calls to stop investing in oil is what would lead to market volatility.
"If anything will lead to future volatility it is the IEA’s repeated calls to stop investing in oil, knowing that all data-driven outlooks envisage the need for more of this precious commodity to fuel global economic growth and prosperity in the decades to come, especially in the developing world."
OPEC+ and the IEA have jousted in recent months over their outlooks for global oil supply and demand. Saudi Arabia, OPEC's de-facto leader, has also blamed the Paris-based IEA and its initial predictions for a 3 million barrel per day (bpd) fall in Russian production on the back of the Ukraine invasion last year for Washington's decision to sell oil from its reserves.
Saudi Energy Minister Prince Abdulaziz bin Salman described the prediction as "screaming and scaring".
OPEC+ decided last year it would stop using data from the
West's energy watchdog when assessing the state of the oil
market.
(Reporting by Maha El Dahan, Writing by Nadine Awadalla;
Editing by Tomasz Janowski, Emelia Sithole-Matarise and Susan
Fenton)
