Kuwait’s oil minister said on Tuesday oil prices could pick up in the second half of 2015.
“The surplus in the market is currently 1.8 million barrels a day and it is the primary reason for the fall in oil prices,” Ali al-Omair said at a seminar in Kuwait.
But Omair said members of the Organization of the Petroleum Exporting Countries (OPEC) agreed that there was no need for another meeting before June.
OPEC declined to cut production at a Nov. 27 meeting and major Gulf OPEC members have since shown no sign of reversing course.
“The price of oil will improve if the production of high-cost oil stops,” Omair said.
Omair pointed to the production of shale oil by the United States at an average cost of $70 to $75 a barrel.
Oil fell to close to $59 a barrel for the first time since May 2009 on Tuesday, extending a six-month selloff as slowing Chinese factory activity and weakening emerging-market currencies added to concerns about demand.
Kuwait’s development projects will not be affected by the drop in oil price, Omair said, adding that the government was looking into the possibility of cutting subsidies on fuel, water and electricity.
New prices for diesel, kerosene and jet fuel will be introduced at the beginning of the new year after subsidies on those fuels are reduced, Omair said.