Russian, Saudi energy ministers to have phone call on Monday: Russia's Novak

Russian, Saudi energy ministers to have phone call on Monday: Russia's Novak

The United Arab Emirates' energy minister said on Monday that his country has spare oil capacity to deal with possible supply disruptions after attacks on Saudi oil facilities this week but that it was too early to call for an emergency OPEC meeting.

On Saturday, the Abqaiq facility and the Khurais oil field in Saudi Arabia were hit by attacks, which resulted in the suspension of 5.7 million bpd of Saudi Arabia's oil production.

In point of fact, spare oil capacity is the amount which a country could produce aside from its usual output, while besides United States, Iran and Venezuela are the only countries which could generate significant spare capacity at a shorter time-frame to cushion up global oil supply chains in times of grave needs such as this, however, both of the countries were barred from exporting crude oil due to a sweeping U.S. ban. Opec has been over-delivering on the pledge and Mazrouei said that, while spare capacity is there, the UAE would stick to its quota.

"But now, we understand that the world has enough commercial stockpiles to cover the shortage... in the mid-term", Novak said, adding he planned to have a call with newly appointed Saudi counterpart, Prince Abdulaziz bin Salman.

OPEC Secretary General Mohammed Barkindo has discussed the oil market development with IEA head Fatih Birol, and both have expressed satisfaction that "the situation has been brought under control by the Saudi authorities", according to an OPEC source.

"If there is a need, in case of an emergency, we always can get together and discuss some other parameters".

"It's still early to talk about it", one of them said.

Saudi Arabia and Russian Federation lead a global oil production deal in which OPEC and non-OPEC nations have agreed to reduce output by 1.2 million bpd in order to help support prices. Opec's share of the cut is 800,000 bpd, to be delivered by 11 members and exempting Iran, Libya and Venezuela.

The extent of any action Opec excluding Saudi Arabia could take to boost supplies is limited, said a third Opec source.

"The issue for the market is that more than 70% of OPEC spare capacity sits in Saudi Arabia", Patterson noted.

Iran holds extra capacity but this is not counted by the IEA due to US sanctions keeping most of its oil exports off the market.

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