Arab News Japan

TOKYO: A report by the Institute of Energy Economics believes that the key challenge for OPEC and other oil-producing countries at present is to stabilize oil prices.

The report by the Institute’s Chief Economist and Managing Director, Ken Koyama, states that excessively high or low prices need to be avoided. Oil is currently trading around the $70 mark.

While OPEC has agreed to increase its production of oil by 400,000 barrels a day, the United States is looking for even greater production.

However, the COVID-19 pandemic is still having a negative impact on the world economy, according to the report, and this is affecting economic expansion and demand for oil. As a result, oil prices dropped to $62.32 on August 20,  uncertainty of the COVID-19 situation is being reflected in the oil market.

“Demand has become difficult to predict,” the report says.

It concludes: “The [OPEC-plus] group now has no option but to continue sensitive supply and demand adjustment … from which the timing for exit is not foreseen.”