1 of 2 | OPEC's secretary general lashed out at the International Energy Agency for suggesting production cuts were designed to manipulate the price of crude oil. File photo by Mohamed Messara/EPA-EFE
April 27 (UPI) -- The secretary general of OPEC on Thursday lashed out at the head of the Western-backed International Energy Agency for suggesting the producer group was trying to support crude oil prices with production cuts.
Haitham al-Ghais, the secretary general of the Organization of the Petroleum Exporting Countries, said neither OPEC nor OPEC+, the core group plus non-member state allies such as Russia, are defending a certain price point for crude oil.
His comments Thursday followed an interview with Fatih Birol, IEA executive director, who told the Bloomberg news agency that OPEC needs to be "very careful" with production policies lest it contribute to global inflation.
OPEC's secretary general said, however, that it was everything from stock movements, algorithms that drive some global trades, geopolitics and other factors that influence the price of oil, not just OPEC policies.
"The IEA knows very well that there are a confluence of factors that impacts markets," he said.
Elsewhere, Birol said production cuts could backfire on OPEC. Should the 1.6 million barrels per day in cuts that start next month lead to a higher-for-longer scenario for the price of crude, consumers of OPEC oil might look in earnest for renewable energy resources.
Al Ghais, however, countered that it was calls from the IEA for an accelerated energy transition that's led to lower investments in oil and gas, and subsequently less product on the market.
When OPEC+ made its surprise decision in early April to trim production, though group defended its position by saying it was a "precautionary measure aimed at supporting the stability of the oil market."
That was seen as a tacit reference to lingering economic instability that could limit demand for crude oil.
Market analysts at the time expected crude oil prices to climb to $100 per barrel in response to the production cuts, though a steady string of data pointing to a weakening global economy pushed prices to below where they were before the announcement.
The price for Brent crude oil, the global benchmark, reached $87.33 about a week after OPEC's announcement, up from $79.77 at the end of March. It was trading closer to $78 barrel as of mid-day Thursday.