Libya’s OPEC Governor Samir Kamal has called for the group to cut oil output by at least 500,000 barrels per day as its largest members discount supplies in an effort to defend market share instead of cutting production to boost prices, according to a report by Bloomberg.
Kamal said that the market is oversupplied by around 1 million barrels per day, Bloomberg said, citing an email sent by the Libyan OPEC Governor.
Kamal said that his comments are his own personal views and not the official Libyan position, Bloomberg reports. Kamal’s comments mark the first time that a member nation representative has suggested how much production needs to be cut after the price of brent crude entered a bear market.
Venezuela’s Foreign Minister Rafael Ramirez earlier this month called on an emergency OPEC meeting, ahead of its planned November 27 meeting, to urgently discuss action that is needed to be taken to arrest the plunge in oil prices.
“I would like OPEC to cut production by at least half a million, as all studies indicate the need for that” because of the increasing output from outside the group, he said.
Libya shouldn’t be expected to cut its own oil output as the country is still struggling to restore production that has been disrupted for more than a year by political conflict, Kamal said.
Libya’s current oil output is still half of what it was prior to the 2011 rebellion that ended Muammar Qaddafi’s 42-year rule, Bloomberg said.
Libya was out of oil markets for nearly a year and the nation faces budget deficits, Kamal said, adding that other OPEC members had said that they “will make room for Libyan production.”
The world’s largest crude exporter, Saudi Arabia, and other large OPEC producers have yet to signal that they will push for a cut at the meeting that is scheduled for November 27 in Vienna.
Since June, the price of brent crude has plunged around 25%.
Source: Bloomberg
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