Oil nears $54 as OPEC agrees to extend cuts
Brent oil is trading at $53.70 Monday afternoon, extending gains as Saudi Arabia said all producers participating in output cuts have agreed on prolonging the deal till the end of the first quarter of next year.
According to the Saudis all the nine countries involved in the quota limits will extend the cut when the cartel ministers hold planned crucial talks and an extension through the first quarter of 2018 will help producers reach their goal of trimming global stockpiles to a five-year.
Saudi’s Khalid Al-Falih said. OPEC and other global producers such as Russia had agreed to reduce production in the first six months of this year, and the decision to extend the cuts will be taken when they meet in Vienna at the end of the month.
“Some ministers say nine months, some ministers think six months,” Iraqi Oil Minister Jabbar al-Luaibi says in interview at Dead Sea, Jordan, when asked about likely duration of extension in cuts by OPEC and non-OPEC oil producers.
“We are optimistic that the extension of the agreement to the second half of this year will improve market stability,” Qatar’s Energy Minister Mohammed Al Sada said today, according to an emailed statement from the ministry.
The resolve by key members of the cartel to extend agreed reductions will benefit Nigeria which is now pumping 2.06m bbl/day of crude and condensates.
The figure comprises 1.66m bbl/day of crude, 400kbbl/day of condensates, Petroleum Ministry spokeswoman says by phone.
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