OPEC sec-gen wants cooperation with non-members on surplus

OPEC Secretary-General Abdullah al-Badri said on Tuesday the oil exporter group should work together with producers outside OPEC to tackle a global surplus of crude.

“All of us should work together, OPEC and non-OPEC – work together to get rid of this overhang,” Badri told an industry conference in London.

“There is one problem we are facing: the overhang of 200 million barrels,” he added.

Non-OPEC producers including Russia have refused to cut their output, although forecasters have reduced estimates for supply growth outside the Organization of the Petroleum Exporting Countries because of a slump in oil prices. Crude prices have almost halved from a year ago.

OPEC has invited non-OPEC countries to attend a technical meeting in October to discuss the market, Badri told reporters, following on from a similar meeting held earlier this year.

Badri said oil supply growth from non-OPEC producers might be zero or negative in 2016 because of lower upstream investment. Investment has been cut by around $130 billion this year from about $650 billion in 2014, he said.

“We will see the effect of the cut on production. This will mean less supply in the near future.”