OPEC says determined to avoid ‘energy crisis’

OPEC is determined to avoid a global “energy crisis” as some of its members are facing international sanctions and others struggling with unrest, the cartel’s secretary-general said in Tehran yesterday. “As an organisation, we will remain focused on our goal of avoiding an energy crisis that may affect the global economy,” Mohammed Barkindo said on the sidelines of an oil and gas exhibition. The Organisation of the Petroleum Exporting Countries will pursue this policy “despite current troubles in several of its member countries,” he said.

His comments came as the end of US sanction waivers for purchases of oil from key OPEC member Iran was due to kick in yesterday. Venezuela, another cartel member, is also facing sweeping US sanctions and in the throes of political troubles while fighting rages between rival forces for control Tripoli, capital of oilrich Libya. Barkindo did not name any country but said some OPEC producers were “currently under unilateral sanctions” -- a reference to Iran and Venezuela. Another country “is also going through transitional challenges with all its potential consequences,” Barkindo said, also apparently about Venezuela where opposition leader Juan Guaido is trying to rally demonstrators against President Nicolas Maduro.

Another cartel member he said, alluding to Libya, “is fighting day in and day out to avoid an all-out war”. OPEC is “committed to stay united” and “not slip back into the chaos” it has faced in recent years, Barkindo said. Last May, President Donald Trump withdrew Washington from the 2015 Iran nuclear deal with world powers that had given Tehran sanctions relief in exchange for curbs on its nuclear programme.

The United States reimposed oil sanctions on Iran in November but initially gave eight countries -- including India and several other US allies -- six-month reprieves. Washington announced last week that the waivers, which have also benefited China and Turkey, would expire on May 2. India -- Asia’s third-largest economy -- imports over 80 percent of its crude oil requirements, leaving it vulnerable to oil price surges.

Saudi Arabia, a member of the OPEC cartel, is the world’s top crude exporters. Iraq, the cartel’s second-largest producer and also a neighbour of Iran, has the capacity to increase its exports by 250,000 barrels a day to compensate for any market shortfalls, an Iraqi government official said last week.