MOSCOW: OPEC and Russia will exit from oil production cuts very smoothly, possibly extending the curbs in some form so as not to create any new surplus in the market, the Russian energy minister told Reuters.
Alexander Novak also said in comments cleared for publication on Friday that he saw no direct connection between the oil cuts and Saudi Arabia’s plan to list Aramco, the world’s top oil producer.
“Everyone in the market is interested in achieving balance,” Novak said in response to a question on whether Saudi Arabia could abruptly exit the cuts as soon as it lists Aramco sometime in 2018. The share sale promises to be the world’s biggest.
OPEC and other large oil producers led by Russia agreed last month to extend until the end of next year their deal to cut a combined 1.8 million barrels per day of output.
The move is aimed at clearing a global stocks overhang and propping up oil prices.
Russia and Saudi Arabia have significantly improved bilateral ties this year, resulting in a visit to Moscow by Saudi King Salman accompanied by a large political and business delegation.
Oil is a key source of budget revenue for both countries.
On Thursday, King Salman and Russian President Vladimir Putin held a telephone conversation during which they agreed to continue close cooperation to ensure stability on global hydrocarbon markets.
OPEC and Russia together produce more than 40 percent of the world’s oil. Moscow’s cooperation on output cuts with OPEC, arranged with Putin’s help, has been crucial in roughly halving an excess of global oil stocks since January.
With oil prices rising above $60, Russia has expressed concern that an extension for the whole of 2018 could prompt a spike in crude production in the US, which is not participating in the deal.
Russia has been pushing to ensure that ending the cuts will not cause a supply deficit or a sharp rise in prices that spurs US shale producers to increase output.
Novak said it would take time for the deal to be brought to an end. “Detailed parameters will be discussed by the time we approach balance. There could be different time frames, depending on forecasts of supply and increasing demand in global markets,” he said.
“We have a common understanding on this issue but I don’t want to discuss hypothetical scenarios now,” Novak said.
“There is a consensus among the (oil) ministers that we should avoid oversupply on the market when exiting the deal.”
Novak said there was an option to extend the deal beyond 2018, while he sees markets balancing in the third or fourth quarters of next year.
“Our task, above all, is (to achieve a) sustainable demand and supply balance. We aim to reach this result, this could be achieved, if things are going well ... during 2018,” Novak said.
Saudi Energy Minister Khalid Al-Falih said on Wednesday it was premature to discuss any changes to the OPEC-led supply pact as market rebalancing was unlikely until the second half of 2018.
— REUTERS
Russia backs gradual exit from oil cuts with OPEC
Russia backs gradual exit from oil cuts with OPEC
Saudi Arabia’s cultural sector is a new economic engine between Riyadh and Paris, says ambassador
RIYADH: Culture has become a fundamental pillar in bilateral relations between France and Saudi Arabia, according to the French Ambassador to the Kingdom, Patrick Maisonnave.
Maisonnave noted its connection to the entertainment and tourism sectors, which makes it a new engine for economic cooperation between Riyadh and Paris.
He told Al-Eqtisadiah during the opening ceremony of La Fabrique in the Jax district of Diriyah that cultural cooperation with Saudi Arabia is an important element for its attractiveness in the coming decades.
La Fabrique is a space dedicated to artistic creativity and cultural exchange, launched as part of a partnership between the Riyadh Art program and the French Institute in Riyadh.
Running from Jan. 22 until Feb 14, the initiative will provide an open workspace that allows artists to develop and work on their ideas within a collaborative framework.
Launching La Fabrique as a space dedicated to artistic creativity
The ambassador highlighted that the transformation journey in the Kingdom under Vision 2030 has contributed to the emergence of a new generation of young artists and creators, alongside a growing desire in Saudi society to connect with culture and to embrace what is happening globally.
He affirmed that the relationship between the two countries is “profound, even cultural par excellence,” with interest from the Saudi side in French culture, matched by increasing interest from the French public and cultural institutions unfolding in the Kingdom.
Latest estimates indicate that the culture-based economy represents about 2.3 percent of France’s gross domestic product, equivalent to more than 90 billion euros ($106.4 billion) in annual revenues, according to government data. The sector directly employs more than 600,000 people, making it one of the largest job-creating sectors in the fields of creativity, publishing, cinema, and visual arts.
Saudi Arabia benefiting from French experience in the cultural field
Maisonnave explained that France possesses established cultural institutions, while Saudi Arabia is building a strong cultural sector, which opens the door for cooperation opportunities.
This comes as an extension of the signing of 10 major cultural agreements a year ago between French and Saudi institutions, aiming to enhance cooperation and transfer French expertise and knowledge to contribute to the development of the cultural system in the Kingdom.
He added that experiences like La Fabrique provide an opportunity to meet the new generation of Saudi creators, who have expressed interest in connecting with French institutions and artists in Paris and France.
La Fabrique encompasses a space for multiple contemporary artistic practices, including performance arts, digital and interactive arts, photography, music, and cinema, while providing the public with an opportunity to witness the stages of producing artistic works and interact with the creative process.
