Opec lowered its output to the lowest level in nearly three decades as it enforced record production cuts to counter a crunch in demand due to the coronavirus pandemic.
Members of the exporters’ group cut production by 1.93 million barrels per day to 22.69m bpd in June, according to Bloomberg data.
Saudi Arabia volunteered additional cuts alongside key Gulf Opec producers, taking its overall production to the lowest level seen since the Gulf War in 1991.
The kingdom cut an additional 1m bpd in May and June to compensate for the group’s laggards. The world’s largest oil exporter cut back 4.8m bpd in total, bringing its production to a record low of 7.492m bpd in June.
The UAE, Opec’s third-largest producer, committed to additional cuts of 100,000 bpd while Kuwait volunteered to draw back an additional 80,000 bpd.
The group, alongside non-member producers led by Russia, who form part of the Opec+ alliance are drawing back a record 9.7m bpd from the markets since May. The pact, which was initially in place for two months, was extended until the end of July to help rebalance the markets battered by the collapse in demand due to the coronavirus pandemic.
"Compliance with Opec production cut targets improved in June with the aggregate level of compliance at over 100 per cent,” Emirates NBD said in a note on Thursday.
"Saudi Arabia over delivered as expected, providing almost 140 per cent of what it was expected to cut while the UAE and Kuwait both achieved around 100 per cent. But there was significant improvement from Iraq and Nigeria, two countries singled out for failing to hit their targets in May.”
Iraq’s compliance improved to 70 per cent from 42 per cent a month earlier while Nigeria reached 77 per cent compared with 47 per cent.
Opec+ convened virtually in April at the peak of the crisis when the pandemic brought air and ground transportation to a sudden halt and caused a sharp decline in prices. The month also saw the West Texas Intermediate benchmark collapse below zero to trade briefly at -$40 per barrel as sellers ran out of storage options.
Last week, Opec secretary general Mohammad Barkindo called the day when WTI collapsed into negative territory ‘Bloody Monday’.
The oil markets are not “out of the woods” yet, he said, adding that the industry would have headed to a “total crush” if Opec+ had not intervened.
Crude prices collapsed by nearly 70 per cent in April from their most recent peaks in January as countries around the world imposed movement restrictions to contain the spread of the virus.
Oil demand was estimated to have shrunk 29m bpd in April, the lowest level since 1995, according to the International Energy Agency. The UAE energy minister Suhail Al Mazrouei called the collapse in demand "the single largest shock to the world economy” last week.
Opec+ is maintaining its production curbs through April 2022 in a tapered manner.
Oil prices, which gained from the collective Opec+ action as well as the pick-up in demand due to the easing of movement restrictions, gave up their gains in recent weeks. The benchmarks registered two weeks of losses as Covid-19 infections crossed the 10 million mark and many countries saw a rise in new cases.
Brent was up 0.62 per cent at $42.29 per barrel, while WTI was up 0.70 per cent at $40.10 per barrel at 1.35pm UAE time.
Oil prices are likely to trend at the $40 per barrel range from "rebounding demand and declining shale output", said Norbert Rücker, head economics and next generation research at Julius Baer.
"[We] see higher prices in the longer term, as rebounding demand and constrained supplies should soon lead to an easing supply glut," he said.
Prices could average "closer to $50 than $60 per barrel" long-term, which will support the revival of the shale business, he added.
Moral education needed in a 'rapidly changing world'
Moral education lessons for young people is needed in a rapidly changing world, the head of the programme said.
Alanood Al Kaabi, head of programmes at the Education Affairs Office of the Crown Price Court - Abu Dhabi, said: "The Crown Price Court is fully behind this initiative and have already seen the curriculum succeed in empowering young people and providing them with the necessary tools to succeed in building the future of the nation at all levels.
"Moral education touches on every aspect and subject that children engage in.
"It is not just limited to science or maths but it is involved in all subjects and it is helping children to adapt to integral moral practises.
"The moral education programme has been designed to develop children holistically in a world being rapidly transformed by technology and globalisation."
Killing of Qassem Suleimani
WHEN TO GO:
September to November or March to May; this is when visitors are most likely to see what they’ve come for.
WHERE TO STAY:
Meghauli Serai, A Taj Safari - Chitwan National Park resort (tajhotels.com) is a one-hour drive from Bharatpur Airport with stays costing from Dh1,396 per night, including taxes and breakfast. Return airport transfers cost from Dh661.
HOW TO GET THERE:
Etihad Airways regularly flies from Abu Dhabi to Kathmandu from around Dh1,500 per person return, including taxes. Buddha Air (buddhaair.com) and Yeti Airlines (yetiairlines.com) fly from Kathmandu to Bharatpur several times a day from about Dh660 return and the flight takes just 20 minutes. Driving is possible but the roads are hilly which means it will take you five or six hours to travel 148 kilometres.
Western Region Asia Cup T20 Qualifier
Sun Feb 23 – Thu Feb 27, Al Amerat, Oman
The two finalists advance to the Asia qualifier in Malaysia in August
Group A
Bahrain, Maldives, Oman, Qatar
Group B
UAE, Iran, Kuwait, Saudi Arabia
UAE group fixtures
Sunday Feb 23, 9.30am, v Iran
Monday Feb 25, 1pm, v Kuwait
Tuesday Feb 26, 9.30am, v Saudi
UAE squad
Ahmed Raza, Rohan Mustafa, Alishan Sharafu, Ansh Tandon, Vriitya Aravind, Junaid Siddique, Waheed Ahmed, Karthik Meiyappan, Basil Hameed, Mohammed Usman, Mohammed Ayaz, Zahoor Khan, Chirag Suri, Sultan Ahmed
The specs
AT4 Ultimate, as tested
Engine: 6.2-litre V8
Power: 420hp
Torque: 623Nm
Transmission: 10-speed automatic
Price: From Dh330,800 (Elevation: Dh236,400; AT4: Dh286,800; Denali: Dh345,800)
On sale: Now
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THE BIO
Ambition: To create awareness among young about people with disabilities and make the world a more inclusive place
Job Title: Human resources administrator, Expo 2020 Dubai
First jobs: Co-ordinator with Magrudy Enterprises; HR coordinator at Jumeirah Group
Entrepreneur: Started his own graphic design business
Favourite singer: Avril Lavigne
Favourite travel destination: Germany and Saudi Arabia
Family: Six sisters
RESULTS
Manchester United 2
Anthony Martial 30'
Scott McTominay 90 6'
Manchester City 0
RESULT
Valencia 3
Kevin Gameiro 21', 51'
Ferran Torres 67'
Atlanta 4
Josip Llicic 3' (P), 43' (P), 71', 82'
Essentials
The flights: You can fly from the UAE to Iceland with one stop in Europe with a variety of airlines. Return flights with Emirates from Dubai to Stockholm, then Icelandair to Reykjavik, cost from Dh4,153 return. The whole trip takes 11 hours. British Airways flies from Abu Dhabi and Dubai to Reykjavik, via London, with return flights taking 12 hours and costing from Dh2,490 return, including taxes.
The activities: A half-day Silfra snorkelling trip costs 14,990 Icelandic kronur (Dh544) with Dive.is. Inside the Volcano also takes half a day and costs 42,000 kronur (Dh1,524). The Jokulsarlon small-boat cruise lasts about an hour and costs 9,800 kronur (Dh356). Into the Glacier costs 19,500 kronur (Dh708). It lasts three to four hours.
The tours: It’s often better to book a tailor-made trip through a specialist operator. UK-based Discover the World offers seven nights, self-driving, across the island from £892 (Dh4,505) per person. This includes three nights’ accommodation at Hotel Husafell near Into the Glacier, two nights at Hotel Ranga and two nights at the Icelandair Hotel Klaustur. It includes car rental, plus an iPad with itinerary and tourist information pre-loaded onto it, while activities can be booked as optional extras. More information inspiredbyiceland.com
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