Algeria calls on OPEC to reduce oil production

Algerian Energy Minister Youcef Al-Yousfi has urged the Organisation of the Petroleum Exporting Countries (OPEC) to reduce oil production following a sharp fall in crude oil prices in recent months, Algerian state news agency reported.

“For us, OPEC has to intervene to correct the imbalance and cut production to bring up prices and defend the income of its member states,” Al-Yousfi said on Sunday.

Al-Yousfi said that Algeria does not support the position of those oil producers who believe that countries who are not members of OPEC would benefit from the production cuts.

Algeria, an OPEC member state, is heavily dependent on oil revenue, which provides 97 per cent of the country’s hard-currency income and 60 per cent of its overall budget.

The minister noted that oil-dependent countries are feeling the pinch with oil prices hovering around $60 a barrel.

Less than a week ago, Saudi Arabia said that OPEC would maintain its current production level of 30 million barrels a day until the organisation’s next meeting in June.

Last Monday, the Financial Times reported Saudi Oil Minister Ali al-Naimi as saying that: “It is not in the interest of OPEC producers to cut their production, whatever the price is. Whether it goes down to $20, $40, $50, $60, it is irrelevant.”

The newspaper described him as speaking “frankly”. It said that he tore up OPEC’s traditional strategy of keeping prices high by limiting oil output and replaced it with a new policy of defending the cartel’s market share at all costs.

Al-Naimi added that the world may never see $100 a barrel again. The newspaper added that: “The comments, from a man who is often described as the most influential figure in the energy industry, marked the first time that Al-Naimi has explained the strategy shift in detail.”