Saudi Arabia’s Energy Minister Khalid al-Falih said on Wednesday the Kingdom is expected to reach an agreement this year to resume oil output from the Neutral Zone it shares with Kuwait.
“We hope in 2019 it will be resolved,” he said, when asked when Saudi Arabia and Kuwait could reach an agreement.
“I am confident,” Falih stressed, referring to possibility of a resolution in 2019.
The Energy Minister met on Tuesday with Emir of Kuwait Sheikh Sabah al-Ahmad al-Jaber al-Sabah.
Resuming production from the Neutral Zone’s oilfields could add up to 500,000 barrels per day each to the oil output of Saudi Arabia and Kuwait.
The Saudi-Kuwaiti Neutral Zone, or Divided Zone, is an area of 5,770 square km between the borders of Saudi Arabia and Kuwait that was left undefined when the border was established by the Uqair Convention of December 2, 1922.
On the other hand, Falih said he hoped the oil market would be balanced by April and that there would be no gap in supplies due to US sanctions on OPEC members Iran and Venezuela.
He said Saudi Arabia would consult and calibrate a supply plan for the second half of the year at the April meeting.
“We hope by April the market will be in balance,” Falih told reporters in New Delhi, adding that the commitment to a global supply-cutting deal was “unquestionable.”
Falih is one of the delegation members accompanying Saudi Crown Prince Mohammed bin Salman on his Asian tour. He is in China now for a two-day visit.
The Organization of the Petroleum Exporting Countries, Russia and other non-OPEC producers - an alliance known as OPEC+ - agreed to reduce oil supply by 1.2 million barrels per day from January 1 this year.
OPEC+ will meet in April in Vienna to decide on its supply policy and whether to extend the output agreement beyond June.
“April will be an important line post of the journey for market stability in keeping supply and demand closely aligned and getting inventories to where we want them to be, which is around the five-year average,” Falih stressed.
A monitoring committee for an OPEC and non-OPEC oil supply reduction deal found compliance with the cuts at 83 percent in January, Reuters quoted four delegates from the group as saying.
