On Wednesday, Saudi Arabia’s Energy Minister, Prince Abdulaziz bin Salman, warned the oil producers to remain cautious. Keeping in mind the high uncertainty of the market. He said, “We are in a much better place than we were a year ago, but I must warn, once again, against complacency. The uncertainty is very high, and we have to be extremely cautious,” at the online IEA-IEF-OPEC Symposium.
Prince also gave a word of caution to the forecasters and traders. He implied that those trying to predict or forecast the next move of OPEC+ stay back. He says it is useless to predict the unpredictable.
In February and March, Saudi Arabia has helped the efforts of the OPEC+ alliance with its extra 1 million barrels per day (BPD) cut. The target is to tighten the oil market in the first quarter of this year. However, the demand remains weak, especially outside Asia.
In the first week of March, the meeting of the OPEC+ group will take place. They are supposed to meet and decide how to proceed with the pact to follow April. The debacle of last March between Russia and Saudi Arabia is unforgettable.
A few days ago, the Russian Deputy Prime Minister, Alexander Novak, said that the global oil market is balanced and reflects the market situation. Analysts feel that this comment from Russia could be indicating a more aggressive easing of the cuts from April.
According to sources, Warren Pattersons, the ING’s Head of Commodities, feels there certainly is room for easing. It entirely depends on Saudi Arabia’s decision to bring back the volumes from its additional cuts.