Suhail Al Mazrouei, Minister of Energy and Industry, has said that the current recovery of the oil market is due to market forces which benefit OPEC and shale oil producers alike.

He made his comments while taking part in the UAE Ministry of Energy and Industry Knowledge Series panel discussion entitled, "Oil and Gas Outlook to 2020, What Stage of Cycle are We in?" on the inaugural day of ADIPEC at the Abu Dhabi Exhibition Centre.

The minister said that shale oil producers are needed as part of the equation, "We cannot exclude them, or think that they are working against us," he said, adding, "Yes, they are one of the beneficiaries of the correction in oil prices."

He also referred to the forecast of oil demand in the past, saying that now it is better than what was predicted. He said, "When we started the deal, the expectations were about how much the shale oil producers would produce, and if you check the data you will find that they were not achieving the level of production that they were thinking."

He said that when the oil prices went down, the market applied significant pressure on the services companies, so the shale oil producers have to work harder to improve. "Some of those improvements are here to stay, some of those improvements are eating their margins, so they cannot sustain it long. However, they continue to invest because they cannot shut down their operations. Some efficiency improvements are going to stay," Al Mazrouei, added.

He said that shale oil producers need higher average prices to give incentives to investors.

Talking about OPEC's rotating presidency, the minister lauded the efforts of Khalid Al-Falih, Saudi Arabia's Minister of Energy, Industry and Mineral Resources. He said that Al-Falih has done excellent work in terms of diplomacy to keep the group together and bring achievements for the organisation.

"It takes connection, it takes travel and efforts, not only on part of the minister but on each member state to reach that conformity level," he said. "I hope that I will continue the good work that he has done, although it is not going to be easy, because we still have moving parts in the equation. The conformity level that has been achieved is great."