Adipec 2016: Oil market nearing balance, says Al Mazroui

abu dhabi - Current oil situation is a win-win for both consumers and producers, says UAE energy minister

UAE Energy Minister Suhail bin Mohammed Faraj Al Mazroui on Tuesday said the current oil situation presents a good opportunity for both consumers and producers.

"The consumers are saving and reviving their economy. For producers like us, we have learnt that competition is going to hurt everyone," Al Mazroui said during a session on 'Empowering Emerging Markets' at the ongoing Abu Dhabi International Petroleum Exhibition and Conference.

The minister said the industry has improved a lot compared to last year. "Now, the market is very close to being in balance. Last year, it was really chaotic. We have sharpened our pencils and taken a leap in efficiency. Now we are benefiting and this will stay with us for years to come."

Al Mazroui, however, struck a cautious note. "There is a balance in supply and demand but there is a risk. The risk is moderate when we look at the projects we cancelled or delayed. We need to understand that this amount is supposed to come to the market. If it's delayed by a year, we will see a shortage of supply. People are exaggerating the contribution from shale oil. I am moderate in my expectation. It will come but at a lower pace than we saw in 2012 and 2013."

Egypt eyes energy export
Egypt Minister of Petroleum and Mineral Resources Tarek El Molla said the country is working its way to become an energy exporter again. "We are one of the oldest oil and gas-producing countries. For different reasons, we ended up being an importer. In the last few years, we have focused on turning our weakness into our strength."

Among positive changes initiated in Egypt, he cited ease in getting concessional agreements, review of gas prices and eliminating bureaucracy. "Now, you can get a concession agreement ratified by parliament in less than eight months," he said.

Egypt is focusing on exploration. "We have some game-changing discoveries. We are trying to attract more investments."

By 2021, Egypt should be self-sufficient in gas and a small exporter too. "We are committed to this," El Molla added.

Pakistan in gas drive
Meanwhile, Pakistan federal minister for petroleum and natural resources Shahid Khaqqan Abbassi said the country is meeting its energy needs through gas.

"We had a serious energy crisis. Nearly 50 per cent of our primary energy is gas and that was the way to fix our problems. We have made a serious shift towards a gas-based energy mix. We are concentrating heavily on efficiency."

Indonesia vice-minister of energy and mineral resources Arcandra Tahar said there is a gap in the country's production and consumption. "There is an opportunity there. It's time to give some incentives to contractors. We are willing to help boost investments."

The new government and a new mindset would help change the climate of investment in Indonesia, Tahar added.

- ashwani@khaleejtimes.com