UAE Energy Minister Suhail al-Mazrouei said on Monday that insufficient investments in the oil and natural gas industry could lead to a hike in energy prices.
Oil and gas are needed to ensure a reliable supply of energy during the transition period required to implement non-carbon emitting projects, he told the Africa Oil Week conference in Dubai.
The UAE, he added, is willing to invest in African solar and wind projects and sees potential in developing hydrogen as an energy source.
“If OPEC+ wasn’t there you would see something similar to what happened with gas and coal,” Mazrouei said. “We are working together to balance the market.”
On the sidelines of the conference, the minister said that the OPEC+ group can increase its crude oil supply to the market if there is demand, he added.
He said that the UAE and its OPEC+ partners may continue with the policy until September 2022.
Mazrouei explained that the oil market is expected to witness a surplus in the first quarter of 2022, amid the current policy to raise oil output by 400,000 barrels per day monthly.
He pointed out that the UAE has invested in the oil sector and has additional quantities that it can pump to the markets when needed, but it is necessary to produce these quantities in light of the “OPEC Plus” alliance and that the UAE or any other country should not leave the alliance because it is the only body that regulates supply and demand.
In October, the UAE announced a plan for net-zero emissions by 2050 and allocated 600 billion dirhams ($163 billion) in investment in renewable energy.
Mazrouei said, “Africa is one of the fastest-growing economies in the world. Additionally, the huge economic transformation in the energy sector in the continent, makes it ideal for investments from around the globe, especially the UAE and the Middle East.
“We have a huge interest in the African market, and we see that the interest has been mutual, with Uganda recently signing new business deals across sectors, including renewable energy, at Expo 2020 Dubai.”
He added that “the Oil and Gas sector has seen unprecedented volatility since 2020 due to the pandemic. However, as the economy rebounds, we are witnessing recovery.
“Global economic growth for this year has remained strong, especially in the second quarter of 2021. In the UAE, moving forward to 2022, the Central Bank of the UAE estimates that the country will experience significant growth in terms of GDP.
“It is evident to the world that oil and gas are significant sources of primary energy supply and strongly impact economic growth and the development of the industrial sector.”
He said the UAE has considered the existence of a link between them and the African continent through the electrical connection between Egypt and the Emirates.
