Egypt backs Saudi technical explanation for OPEC+ oil cuts

Amr Kandil , Monday 17 Oct 2022

Egypt has voiced support to Saudi Arabia’s explanation of the technical considerations behind the recent decision of the OPEC+ group to cut oil production, which triggered tensions.

Egyptian Foreign Ministry
File Photo: Egyptian Foreign Ministry building. Al-Ahram


“Egypt follows closely the reverberations of the decision recently issued by the OPEC+ and the tensions that arose around it,” Egypt’s Ministry of Foreign Affairs said in a statement on Monday.

“Egypt endorses the stance expressed by the sisterly Kingdom of Saudi Arabia in explaining the technical considerations for the OPEC+ decision as it aims to maintain oil market discipline in the first place,” the foreign ministry said.

“This comes in a way that enhances the ability of the international community to tackle the current economic challenges,” the ministry added, citing Saudi explanations.

In the first week of October, Saudi-led OPEC+, a group of countries that includes the largest global oil producer Saudi Arabia, announced cutting production by two million barrels per day starting November.

In a statement last week, the Saudi foreign ministry said the decision, adopted unanimously, aims at curbing market volatility while taking into account supply and demand.

The decision comes after prices dropped to $90 per barrel in September, down from $120 in spring. The move is expected to ensure therecovery of oil prices for producers.

The decision, however, has angered the United States, the world’s top oil and consumer. The US accused the kingdom of aligning itself with Russia amid the current crisis in Ukraine.

Riyadh knew the cut "would increase Russian revenues and blunt the effectiveness of sanctions" on Russia, said White House Spokesman John Kirby last week.

The US pushed hard over the past weeks to discourage the OPEC+ output cut decision as President Joe Biden struggles to prevent a new hike in US gasoline prices ahead of the upcoming congressional elections.

Egypt as well as OPEC+ members, including Iraq, Oman, Kuwait, Bahrain, and Algeria, have voiced support to the organisation’s production cut decision.

Egypt, a major oil importer, imports 100 million oil barrels per year despite producing a part of its required consumption of petroleum products, Prime Minister Mostafa Madbouly said in July.

Saudi Arabia has rejected the US accusations of making oil production cuts to drive up crude prices, saying the decision was based on “pure economic reasons” rather than political ones.

OPEC+ is a group of 24 oil-producing nations consisting of the 13 members of the Organisation of Petroleum Exporting Countries (OPEC) and other producers, including Russia.

Short link: