LONDON: UAE Energy Minister and OPEC President Suhail Al-Mazrouei said the US shale oil industry was “not a threat” to OPEC member oil-producing countries.
Speaking at an event in London on Feb. 20, he said it was important that the oil industry does not repeat the “mistakes of the past,” where producers became “so excited” by rising shale oil production that they overproduce, causing an imbalance in the market and job losses.
A glut in oil supply caused global oil prices to plummet from mid-2014.
Al-Mazrouei said OPEC plans to meet US shale oil producers at CeraWeek event in the US next month when they will explore the outlook for shale, rather than relying solely on analysts’ reports on the industry.
He underlined the commitment of all 24 OPEC and non-OPEC countries, including Russia, to continue to cut oil production by 1.8 million barrels per day until the end of 2018, following last November’s agreement.
“We are focused on what we agreed in 2017 to work together to balance the market,” he said, refuting suggestions of talks within any countries about an exit strategy from the deal.
“I don’t think we are talking about exit strategy for the time being, we are focused on one target, which is balancing the market,” he said.
Al-Mazrouei said he would like OPEC and non-OPEC oil producers to continue to work together beyond 2018 to ensure “market stability,” as the “job is not complete.”
Commercial oil stocks in the Organization for Economic Cooperation and Development (OECD) have fallen by more than 220 million barrels since the beginning of last year, compared to the five-year average, he said.
There remains a further 100 million barrels to remove from the market to reach the five-year OECD inventory average.
Al-Mazrouei confirmed there were plans for an alliance of the 24 non-OPEC and OPEC producers, but he refused to give details while the plans were still in draft form.
He expressed the hope that the alliance would not only be based on benefiting members, but also on “how we contribute to world economic growth.”
And he also reconfirmed previously reported recommendations that oil producer countries need to have capacity buffers in place to help deal with any shocks to the market.
OPEC president says shale no threat to group
OPEC president says shale no threat to group
Saudi ports brace for cargo surge as shipping lines reroute
RIYADH: Preliminary estimates suggest that several global shipping lines could reroute part of their operations to Saudi Arabia’s Red Sea ports, potentially adding 250,000 containers and 70,000 vehicles per month, according to Rayan Qutub, head of the Logistics Council at the Jeddah Chamber of Commerce, in an interview with Al-Eqtisadiah.
“Any disruption in the Strait of Hormuz not only affects maritime traffic in the Arabian Gulf but could also reshape global trade routes,” Qutub said, highlighting the strait’s status as one of the world’s most critical maritime chokepoints for energy and goods transport.
With rising regional tensions, international shipping companies are reassessing their routes, adjusting shipping lines, or exploring alternative sea lanes. This signals that the current challenges extend beyond the Arabian Gulf, impacting the global supply chain as a whole.
Limited impact on US, European shipments
The effects of these developments will not be uniform across trade routes. Qutub noted that goods from China and India, which rely heavily on routes through the Arabian Gulf, are most vulnerable to disruption. In contrast, shipments from Europe and the US typically traverse western maritime routes via the Suez Canal and the Red Sea, making them less susceptible to regional disturbances.
Saudi Arabia’s strategic location, he emphasized, strengthens the resilience of regional trade. The Kingdom operates an integrated network of Red Sea ports — including Jeddah, Rabigh, Yanbu, and Neom — that have benefited from substantial infrastructure upgrades and technological enhancements in recent years, boosting their capacity to absorb increased cargo volumes.
Red Sea bookings
Several major carriers, including MSC, CMA CGM, and Maersk, have already opened bookings to Saudi Red Sea ports, signaling a shift in operational focus to these strategically positioned hubs.
However, Qutub warned that rerouted shipments could increase sailing times. Cargo from Asia, which normally takes 30-45 days, might now require longer voyages via the Cape of Good Hope and the Mediterranean, potentially extending transit to 60-75 days in some cases.
These changes are also reflected in rising shipping costs, driven by longer routes, higher fuel consumption, and increased insurance premiums — a typical response when global trade patterns shift due to geopolitical pressures.
Qutub emphasized that Saudi Arabia’s transport and logistics sector is managing these developments through coordinated government oversight. The Ministry of Transport and Logistics, the Logistics National Committee, and the Logistics Partnership Council recently convened to evaluate the impact on trade and supply chains. Regular weekly meetings have been established to monitor developments and implement solutions to safeguard the stability of supplies and continuity of trade.
He noted that the Kingdom’s logistical readiness is the result of long-term strategic investments, encompassing ports, airports, road networks, rail systems, and logistics zones. Today, Saudi logistics integrates maritime, land, rail, and air transport, enabling a resilient response to global disruptions.
Qutub also highlighted the need for the private sector to continuously review logistics and crisis management strategies, develop alternative plans, and manage strategic stockpiles. Such measures are essential to mitigate temporary fluctuations in global trade and ensure smooth supply chain operations.
