Badri: OPEC says shale ‘not a challenge’
OPEC secretary-general says organization could not ‘subsidize’ shale
The Organization of the Petroleum Exporting Countries (OPEC) Secretary-General said on Sunday that its exporters could not “subsidize” shale, a source of energy whose growing output in recent years is blamed by the group for weakening oil markets.
Abdullah al-Badri added in remarks to a conference in Bahrain that tight oil, a term he has used for shale, was “not a challenge for us” but he suggested the market should now decide which source of petroleum could survive at current prices.
Oil prices have slid to near six-year lows in recent months as a result of a large supply glut, due mostly to a sharp rise in U.S. shale production as well as weaker global demand.
“We welcome tight oil ... but this source of energy costs too much to produce. You cannot produce it at $70-$80 or $90, you need $100 plus to produce, sell it and make income out of it,” Badri said.
“OPEC cannot subsidize another source of energy – if we reduce [production] in November we will reduce in January. We will reduce in December. We will reduce maybe for another four to five years,” he said.
“We cannot every time keep reducing our production, it [tight oil] is not a challenge for us ... we welcome it, but let the market decide now.”
- Saudi oil minister expects market to balance, prices to stabilize
- Saudi's Naimi says oil demand is growing, markets calm
- Oil rallies for 3rd day after OPEC sees greater crude demand
- Libyan OPEC representative released
- Oil steadies after OPEC says prices may have bottomed
- OPEC’s Badri expects some oil price rebound soon