OPEC Secretary-General Abdullah al-Badri expressed confidence on Wednesday that oil prices, currently near their lowest since 2009, will rebound, and defended the producer group’s decision not to cut output in November.
Oil prices have fallen almost 60 per cent since June, reaching a 2009 low close to $45 a barrel earlier this month, partly because of OPEC’s November decision not to cut output.
Badri said, if OPEC had reduced its supply, non-member countries would have increased production, forcing OPEC to implement further cuts and lose more market share to rival producers.
“Everyone tells us to cut. But I want to ask you, do we produce at higher cost or lower costs? Let’s produce the lower cost oil first and then produce the higher cost,” Badri said, addressing the World Economic Forum in Davos, Switzerland.
“Prices will rebound. I saw this 3-4 times in my life.”
“We will go back to normal very soon,” he said.
He said OPEC’s policy was not directed at Russia, Iran or the United States.