The UAE economy minister Sultan bin Saeed Al Mansour said the current low oil prices have only had a limited impact on the overall development in the UAE, which, along with the approval of the budget, shows clearly that the UAE succeeded in carrying out flexible and successful policies that will enable it to continue diversification of income and decrease reliance on oil revenue in the future. “My colleague, the minister of energy, has indicated several times that they look at $80 as an ideal price for oil as we go on in the next phase”, said Al Mansouri, addressing a press conference to mark the beginning of the Global Agenda Summit.
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Oil at $50 a barrel is a “gift to the world” as prices should be low enough to spur economic growth, according to the head of Abu Dhabi’s Department of Economic Development.
“The world economy is definitely going to pick up”.
The world economy is expected to pick up in the second half of 2016, he added. In August it abandoned a system of fixed gasoline prices in favour of one linked to global oil prices.
“For a decade, OPEC output has been essentially flat with all the growth going to Canadian oil sands, American frackers and other non-OPEC producers”, Shilling wrote.
Earlier last week, Masood Ahmed, director Middle East and Central Asia at the worldwide Monetary Fund (IMF) said the UAE would record a fiscal deficit of 3.5 percent of gross domestic product which could increase further in the coming years in case oil prices would not pick up significantly.
In the past year, oil prices have collapsed as United States shale production surged while worldwide demand declined somewhat, pressuring a number of oil-producing nations including Saudi Arabia and the UAE, which had depended on higher prices to meet certain budget requirements.
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On Iranian oil entering the market and what its impact would be, Al Mansouri said the production of oil from Opec is usually controlled by quota.
