Price volatility in the oil market is dangerous thing — OPEC

President of Organization of Petroleum Exporting Countries (OPEC) H.E. Antonio Aburu Ondo, has stated that price volatility in the oil and gas industry is a dangerous thing, hence, the cartel will do everything possible to prevent it from happening.

He argued strongly that price volatility throws governments’ budget plans out of gear which subsequently affects the well-being of their citizens.

To avoid this phenomenon, he explained that OPEC makes sure that prudent and pragmatic measures are in place to ensure stability in crude oil prices.

Speaking in an exclusive interview with energynewsafrica.com on the sidelines of the second Russia-Africa Summit in St Petersburg, Russia, H.E Antonio Ondo, who is the Minister for Mines and Hydrocarbons in the Republic of Equatorial Guinea, stated that OPEC’s primary occupation is to ensure that gas and oil consumers across the globe especially and particularly those in Africa, are insulated from unexpected shocks.

“The coming in of OPEC is not about increasing or reducing prices, right? OPEC is about creating market stability. OPEC’s actions are to ensure that the market is stable. We don’t want price volatility. Volatility is a dangerous thing because the government can’t plan their budget. If the government can’t plan their budget, then, they will lose the ability to take care of their people,” he said.

Crude oil prices have been soaring since June this year.

Saudi Arabia cut its daily production by one million barrels in July, and it plans to cut an additional one million next month.

Russia, another OPEC member, has announced that it would cut supply by 300,000 barrels per day in September.

These reductions in supply are likely to shoot crude prices up in the next couple of days.

Brent crude price is hovering $85 per barrel while WTI is selling around $82 per barrel as of Monday, August 7, 2023.

Touching on what energy transition meant to him, he observed that it should be diversified energy sources, ensuring accessibility and affordability to the ordinary energy user.

“Whatever actions we take towards energy transition, they have to take into consideration the fact that people need access to energy and typically, people need access to the type that is affordable and that is accessible to them,” H.E Oburu Ondo asserted.

Concerning why wind energy could be expensive for a country such as Ghana, he was of the view that though wind could abound in the West African nation, the resources to set up the wind infrastructure makes it difficult for ordinary Ghanaians to have access to it though if done, it is one of the cheapest, easily accessible sources of energy that could be found.