Date
17 October 2017
Mohammed Barkindo says he believes that "what is good for OPEC is good for the US". Photo: Bloomberg
Mohammed Barkindo says he believes that "what is good for OPEC is good for the US". Photo: Bloomberg

OPEC chief seeks energy dialogue amid surge in US shale output

OPEC’s top official has sought to allay speculation that a surge in US shale output could impact the oil cartel’s agreement to cut oil production.

Addressing an oil conference in London Tuesday, OPEC Secretary-General Mohammed Barkindo said he aims to begin an energy dialogue with the US, rather than fret over the rise in supply from American oil producers, Marketwatch reports.

“We are not looking at the US as a risk, we are looking at the US as a partner — a strategic partner in the rebalancing process,” Barkindo was quoted as saying.

The comments came as the number of US rigs has increased in recent weeks as producers were encouraged by stronger oil prices amid OPEC production cuts.

Also, President Donald Trump has said that he plans to reduce America’s reliance on oil imports from OPEC members.

Barkindo sought to rebuff speculation that the ramp-up in US output could derail the oil cartel’s output cut agreement. 

“There is an understanding that what is good for OPEC is good for the US,” he said at the International Petroleum Week conference, according to the Wall Street Journal.

The OPEC chief said he plans to meet US shale producers next month at an energy conference in Houston to exchange information on technological and financial issues.

Battered by an oil price crash two years ago, the US shale industry has revived after oil prices rose by 20 percent in the past two months.

Drillers added eight oil rigs in the week to Feb. 10, bringing the total to 591, the most since October 2015, the Journal reports, citing data from US driller Baker Hughes.

The oil price increase was driven by OPEC’s decision in November to reduce production.

The oil cartel said this month its members had cut output by about 90 percent of the 1.2 million barrels a day that they agreed on last November.

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