During 2019, international petroleum prices continued to be influenced by US sanctions on Iran, Venezuelan instability, China’s economic health, global recession and financial turmoil, 2020 maritime regulations and OPEC’s decision to decrease production for 2019.
With OPEC+ production cuts agreed to in 2019 expiring at the end of March 2020, Saudi Arabia and Russia are expected to increase production which is predicted to lead to a price war. This strategy reveals a shift to prioritising market share rather than market stabilisation and price support. It is expected that this stratagem will lead to a supply flood, inventory surge and coronavirus led demand shock to this commodity that was already
seen as relatively depressed in terms of pricing which will inevitably depress those prices further – the question only remains as to how much.
Given the volatilty associated with the Energy Sector locally, regionally and internationally, the Ministry will continue its focus on its 2030 vision in an effort to negate these international market dynamics.