Oil producers should get used to $60 per barrel, says Oman minister

Oil producers have been told to forget about rising oil prices and resign themselves to a world where the price per barrel remains at around $60, according to the Minister of Oil and Gas of Oman, Mohammed bin Hamad Al Rumhi.

A report by the Russian News Agency (TASS) quotes Al Rumhi as saying: “Every producer needs $80 per barrel compared to $60, but is it reasonable? Probably not, not in the current circumstances. We need to move with the current economic environment. I would enjoy seeing oil grow from $60 to $80, but it is highly unlikely.”

According to the forecast of international rating agency Fitch, the price of oil in 2019 will be $65 per barrel. For many Middle Eastern OPEC members – in particular, the UAE and Kuwait – this price is quite comfortable, analysts said, with the exception of Saudi Arabia, for which a deficit-free budget starts at $80 per barrel.

Saudi Arabia is the largest oil producer in OPEC, and is the leader of the OPEC+ agreement along with Russia.

The OPEC+ output reduction deal remains in effect until the end of March 2020 and is designed to stabilize oil prices. In total, the countries participating in the agreement should reduce production by 1.2 mln barrels per day against the level of October 2018. The main reduction quotas fall on the largest parties to the agreement – Russia and Saudi Arabia (228,000 and 322,000 barrels per day, respectively).

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