A number of OPEC leaders on Tuesday called for continued cooperation between oil producing countries in order to maintain price stability in the global oil market.
"From the end of 2014, the market took a correction, and it took longer than we all expected ... Over $1 trillion was lost," OPEC Secretary General Mohammad Sanusi Barkindo said at the second day of CERAWeek 2018 by IHS Markit.
He emphasized that 24 oil producing countries have participated in the Declaration of Cooperation which was signed at the end of 2016 to curb the output of oil producing countries in order to raise oil prices.
"All countries and sectors have to come together. We cannot continue to walk in isolation. We have to work together to maintain sustainability," he said.
Qatar's Minister of Energy and Industry Mohammed Saleh Abdulla Al-Sada said it was "a negative-sum game" when oil prices started to plummet from $120 per barrel in mid-2014 to $27 a barrel in January 2016.
"All producers and consumers were losing ... We needed to get the market to rebalance again. We saw nobody was winning in the medium- to long-term," he added.
He continued to say that, "OPEC acted responsively to get the market to rebalance again."
Despite the rising shale oil production in the U.S., Al-Sada noted that OPEC's conventional oil would continue to be important in the global oil market.
"Most of the conventional oil will still be competitive and cheaper. They will go stronger. What is important is how much oil will come to the market and how fast," he explained.
Kuwait's Minister of Oil, Electricity and Water, Bakheet S. Al-Rashidi said OPEC has been "on the right track" since January 2017 when the Declaration of Cooperation agreement began its implementation.
In addition to the production cut deal, he said strong demand for oil and the global GDP growth have also helped support the oil market.
He also emphasized the importance of price sustainability for investments in the oil industry.
"Price stability is good for both consumers and producers. If there is stability and if you are away from volatility, the industry is going to plan for projects and these can take five to seven years," he said.
"In the end, we need some kind of a body to achieve stability," he added.
Barkindo said he welcomes further members to join the Declaration of Cooperation, which is also referred to as the 'Vienna Alliance.'
"Countries of OPEC sit on the world's 80 percent proved oil reserves. They are cheaper than any. OPEC will be the most dependable supplier in future, and oil will continue to be the most dominant energy resource until 2040," he affirmed.
Barkindo also disclosed that he met some U.S. shale oil producers late Monday for oil market discussions.
"We exchanged notes about how we navigated ourselves through this [low oil] cycle. Competitiveness was also discussed. We realized it was a combination of technical managerial expertise. They [U.S. shale producers] reduced costs and increased efficiency at the same time," he said.
(Anadolu Agency)
