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Extension of oil output reduction pact likely for 6 months or more: Russian energy minster

Xinhua, May 13, 2017 Adjust font size:

An agreement on oil output cuts reached by major oil-producing countries is likely to be extended for another six months or even longer, Russian Energy Minister Alexander Novak said Saturday.

Members of the Organization of the Petroleum Exporting Countries (OPEC) and 11 non-OPEC oil-producing countries will discuss extending the foresaid agreement to cut oil output at a meeting in Vienna on May 24-25, according to the minister.

"I think we will probably be discussing at least a six-month period or even longer than that," Novak was quoted by Russian news agencies.

To shore up weak oil prices, the OPEC and 11 non-OPEC states, including Russia, agreed during a meeting in Vienna in November 2016 to trim oil production by a total of 1.8 million barrels per day for the first half of 2017. Under the deal, Russia pledged to reduce oil output by up to 300,000 barrels per day.

The agreement has been jointly implemented nearly 100 percent, and the current level of production cuts will be maintained if the decision to prolong the agreement is reached, Novak said.

In addition, the supply-demand balance on the global oil market will be restored as early as this year in case the Vienna agreement is extended, he added.

"We need to monitor many factors that affect it (oil market balance)...Judging from the current dynamics of the decline of oil and oil-product stockpiles, the markets will see such reduction in inventories by the end of 2017 or the beginning of 2018," Novak said. Endit