UAE oil minister says global crude glut may last years

The global oil glut could last months or even years, but crude prices could recover if non-Opec producers "act rationally", according to the United Arab Emirates' (UAE) oil minister Suhail bin Mohammed al-Mazrouei.

The minister, in an interview with The National, said that the UAE will not "panic" over low prices and that the market will eventually stabilise itself.

Mazrouei added that low prices will not delay his country's plans to boost its output capacity to 3.5 million barrels per day (bpd) by 2017.

"We are experiencing an obvious oversupply in the market that needs time to be absorbed," the minister was quoted as saying by the Abu Dhabi-based state-owned newspaper.

"Depending on the actual production growth from non-Opec countries, this problem could take months or years. If they act rationally, we can see positive corrections during 2015.

"We have dealt with such fluctuation in the past and we will not panic this time. There is a world demand increase on crude oil and especially our crude and we believe the market will stabilise itself eventually," Mazrouei was quoted as saying.

Oil cartel Opec's refusal in November 2014 to cut its output "was supported by all members including the UAE and we are confident on the strategic nature of such a decision," he said.

"Opec was not part of the oversupply and shall not be blamed if other non-OPEC countries oversupply the market."

The minister's comment follows recent calls by core Gulf Arab Opec members, such as Saudi Arabia, that non-Opec producers should limit planned increases in output to help boost falling oil prices.

Opec, which pumps a third of the world's oil, has repeatedly refused to cut output because it does not want to give up market share.

Some Arab Opec members said last month that the cartel will not cut output alone. The demanded that non-Opec producers such as Russia, Mexico, Kazakhstan and any other nation producing over a million barrels of oil a day cut or at least freeze output if they want a stable market and better prices.