Saudi Arabia and Russia pledge continuation of oil deal beyond 2018
Baku, January 23, AZERTAC
“Output limits should remain through 2018 as rebalancing may be achieved next year”, Saudi Arabia’s Energy Minister Khalid Al-Falih said in a Bloomberg television interview held with his Russian counterpart on Sunday.
Russia is prepared to cooperate with OPEC after the current curbs expire, Energy Minister Alexander Novak said. Neither minister said if the cuts would continue in 2019.
Brent has eased after supply curbs by the Organization of Petroleum Exporting Countries and its allies to reduce a global glut pushed prices above $70 for the first time since December 2014.
OPEC and its allies see merit in maintaining their output limits into 2019, Oman Oil Minister Mohammed Al Rumhy told reporters before a meeting to assess compliance to the accord. The compliance rate among all participants in 2018 will beat the 107 percent average in 2017, Al-Falih said.
The exact mechanism for cooperation next year has not yet been decided, Falih said, but if oil inventories increase in 2018 as some in the market expect, producers might have to consider rolling the supply cut deal into next year.
“There is a readiness to continue cooperation beyond 2018... The mechanism hasn’t been determined yet, but there is a consensus to continue,” Falih said after a meeting of the joint ministerial committee which oversees implementation of the cuts.
Falih said the overall compliance of OPEC and non-OPEC nations with the production cuts was 129 percent in December. The next meeting of the joint ministerial committee overseeing implementation of the cuts will be held in April in Saudi Arabia, an OPEC statement said.
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