Saudi Arabia’s latest oil minister Khalid al Falih has indicated that the worst of the oil glut in oil supply could soon come to an end.
He also signaled that OPEC (Organization of the Petroleum Exporting Countries) is getting ready to reassert a modicum of control over the oil market, following two years in which the prices were allowed to fall.
During a trip to the UK, Khalid al Falih commented that Saudi Arabia would be ‘expected’ to begin the process of balancing oil supply and demand as the market recuperates, enabling the globe’s largest exporter of oil to once again take its role as global swing producer.
Speaking to The Houston Chronicle, he said:
“We are out of it. The oversupply has disappeared. We just have to carry the overhang of inventory for a while until the system works it out.”
Saudi Arabia caused problems for the energy markets towards the end of 2014, when the Kingdom’s then oil minister, Ali al Naimi, made the decision to keep the oil flowing, despite a growing amount of unconventional supplies.
Instead of taking action, the OPEC boss allowed oil process to fall in order to squeeze costlier producers out of the market, causing many people to say that the organization had lost its relevance
This move will be a welcome relief to OPEC and major oil producers, including Fuchs Petrolub, who make Fuchs WSP 783-L, who should soon see some stability in the market.