OPEC seeks consensus on duration of oil cut pact before meeting

0
329

The Organization of the Petroleum Exporting Countries, plus Russia and nine other producers, are cutting oil output by about 1.8 million barrels per day (bpd) until March 2018 in an effort to eradicate a supply glut that has weighed on prices.

The comments indicate an increasing chance that the deal will be extended further into next year at the Nov. 30 meeting. Oil prices are trading at a more than two-year high, but an overhang of stored oil has yet to be fully eradicated.

“Extensive consultations are currently ongoing to reach some consensus before Nov. 30 on the duration beyond the March 2018 deadline,” OPEC’s Mohammad Barkindo told reporters.

“I have not heard so far any participating country that is violently objecting to extending the decision.”

The producers are in the process of inviting other countries to the Nov. 30 meeting, Barkindo said, with a view to joining the deal. He declined to name the countries concerned.

Reuters reported last month, citing OPEC sources, that producers are leaning towards extending the deal for a further nine months, though the decision could be postponed until early next year depending on the market.

Barkindo, who was speaking at a press conference for OPEC’s latest World Oil Outlook, said the recent rise in prices reflected improved market fundamentals and producers’ high adherence to the supply pact.

“As a result of the high level of conformity of the 24 participating countries in the declaration of cooperation, the market has also responded very positively,” he said.

“I am not hearing any diverging view that this market that has been out of balance since the fall of 2014 is finally coming back to a rebalanced market driven largely by fundamentals, assisted by the efforts of OPEC and non-OPEC (members).”

The supply pact is aimed at reducing oil stocks in OECD industrialized countries to their five-year average and the latest figures suggest OPEC is more than halfway there.

Reporting by Alex Lawler and Shadia Nasralla; Editing by David Goodman

(Reuters)

SHARE
Previous articleSky says it could shut Sky News if Fox takeover blocked
Next articleU.S. EIA lifts 2018 world oil demand growth forecast
Godwin Okafor is a financial journalist, Internet Social Entrepreneur and the Founder Naija247news Media Ltd He has over 16 experiences in journalism, which cuts across traditional and digital media. He started his journalism career in Business Day, Where he was a senior editorial graphic artist, before he left to start Naija247news, An Online Financial Newspaper in 2010. He has won series of awards and he is the chairman of Emmerich Resources Limited, the publisher of Naija247news.com and also sits on the board of Students In Business Awards, (SIBA).

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.