The oil market is absorbing additional crude supplies from Opec+ without creating excess inventories, underscoring robust global demand and justifying the recent accelerated output hikes, UAE Energy Minister Suhail Al Mazrouei said in Vienna.
Speaking on the sidelines of the 9th Opec International Seminar, Al Mazrouei emphasised that the oil market fundamentals remain strong despite persistent speculation and price volatility. He pointed to the lack of stockbuilds in recent months — even after eight core Opec+ members began raising production targets — as evidence that the market needed the additional supply.
“You can see that even with the increases for several months we haven’t seen a major buildup in inventories, which means the market needed those barrels,” he said. “We need to look at the fundamentals and build the narrative around them, rather than just news and speculation.”
Oil market analysts said the UAE’s message is clear: supply increases are not a sign of surplus but a necessary response to resilient demand, underlining the need for a pragmatic approach to energy policy and production planning.
Opec+ — which includes key producers such as Saudi Arabia, Russia, the UAE, Iraq, and Kuwait — recently announced a sharper-than-expected increase in crude output for August, raising the collective target by 548,000 barrels per day (bpd). This follows three months of more moderate hikes of 411,000 bpd each, as the group gradually unwinds a voluntary 2.2 million bpd cut agreed in April 2023.
The decision to step up production came after sustained pressure from major consuming nations and market signals pointing to tighter supply in the second half of 2025. With demand for oil forecast to reach record levels, particularly from non-OECD Asia, analysts say the increased supply is not only timely but necessary to prevent price spikes.
According to the International Energy Agency (IEA), global oil demand is expected to grow by 1.1 million bpd in 2025, driven by robust consumption in India and China and rising jet fuel usage as air travel rebounds. The IEA also reported that global commercial oil stocks remained below the five-year average through the second quarter, reinforcing the UAE minister’s claim that the market is far from being oversupplied.
Al Mazrouei dismissed concerns that the group’s output hikes could lead to a supply glut later in the year. “Opec+ assesses the market balance at each meeting,” he said. “What we want is stability. That goal requires accepting whatever price the market accepts. Focusing only on prices is short-sighted.”
He also raised the alarm about chronic underinvestment in oil and gas production, warning that the industry is not spending enough to ensure future energy security. “We are living in an underinvestment environment. The longer this period lasts, the more pain we will face in the years to come,” he said.
His remarks echoed similar concerns voiced by other oil executives at the seminar, where energy security, investment, and the role of hydrocarbons in a balanced energy transition topped the agenda. The Opec International Seminar, held at Vienna’s Hofburg Palace, gathered over 1,000 ministers, CEOs, and policymakers for high-level discussions on global energy challenges.
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