PAJ chief dismisses likelihood of OPEC to make additional oil output cut soon
Petroleum Association of Japan president Yasushi Kimura said Monday that he does not expect OPEC to make an additional production cut soon as the group should be monitoring oil markets, following its May decision with non-OPEC producers to extend their agreement by nine months.
"Even if OPEC makes additional cuts right now, it would not have much impact," Kimura told a press conference in Tokyo.
"Without a clear impact, it would be difficult for OPEC to move... Judging from the current situations, they would likely be monitoring situations for the time being as they just extended it [the output cut deal] by nine months."
Kimura's comments came as Iranian oil minister Bijan Zanganeh said Wednesday that OPEC ministers had already been holding discussions about increasing the cuts given the state of the oil market, although some members maintain that the recent extension of the deal needs more time to play out.
Kimura also said that global oil demand growth, however, should exceed supply growth as current oil price levels should support steady growth in oil demand -- another factor OPEC is monitoring closely.
"At this price level, global oil demand should steadily increase," said Kimura, adding that the speed of global oil demand growth should exceed the pace of incremental production from the US and others.
The monitoring committee overseeing the OPEC/non-OPEC production cut agreement said Thursday that oil market fundamentals were improving, even as some ministers have begun to discuss the possible need for deeper output reductions.
The committee, composed of ministers from Kuwait, Russia, Venezuela, Algeria and Oman, said it will meet July 24 in St Petersburg, Russia. It is empowered to recommend further cuts or any other adjustments to the deal, as it sees fit, officials have said.
The deal, now extended through March 2018, calls on OPEC to cut 1.2 million b/d and 10 major non-OPEC countries, led by Russia, to cut a collective 558,000 b/d.
NO ISSUE TO CO-LOAD WITH QATARI OIL
Speaking at the press conference, Kimura said Japanese refiners have seen minimal impact on their crude oil procurements from Saudi Arabia's June 5 decision to break diplomatic ties with Qatar, followed by moves from Bahrain, the UAE and Egypt.
"So far we understand there has been no big impact on crude supplies resulting from this," Kimura said.
In the event of seeing some restrictions to tankers coming from Qatar to co-load with Qatari oil, Japanese refiners could face some issues, but Kimura said: "Currently there is no issue on that front."
Abu Dhabi's Petroleum Ports Authority has removed restrictions that prohibited tankers going to or coming from Qatar calling at its petroleum ports, effectively lifting the ban on co-loading, according to a circular issued Tuesday by the authority, distributed by Abu Dhabi National Oil Company.
The No. 2 circular obtained by S&P Global Platts Wednesday replaces the No. 1 circular, which included "denial of entry into any of the petroleum ports for all vessels arriving from, or destined to Qatar, irrespective of its flag."
The No. 2 circular states that the ports are "not to receive any Qatari flag vessel or any owned by Qatari companies or Qatari individuals; not load/unload any cargo of Qatari origin in any port or water of UAE; not to allow ships to load any cargo of UAE origin to State of Qatar."
ADNOC officials were not immediately available to comment Thursday but a source close to ADNOC, who declined to be named, confirmed that the restrictions on co-loading Abu Dhabi and Qatari oil had been lifted.
