OPEC’s agreement with Russia and other non-OPEC producers to cut oil production will probably be extended a further nine months to the end of 2018, OPEC sources told Reuters.
The agreement is currently set to expire in March 2018.
A tightening oil market and higher prices are bolstering confidence in the agreement, Reuters reports.
The oil-cartel is expected to discuss a possible extension at its November meeting.
“If demand growth is performing very well, then the decision might be postponed till early next year,” an OPEC source told Reuters.
In an agreement implemented last January, OPEC and a number of non-OPEC oil producers agreed to cut oil production by 1.8 million barrels per day (b/d) to draw down global stocks of crude oil and raise prices. The agreement was later extended until March 2018.
Saudi Arabia and Angola are the only two OPEC members that have fully complied with the agreement from the beginning, Bloomberg reports. The International Energy Agency (IEA) estimates that OPEC compliance with the agreement currently stands at 86%, Reuters previously reported.
While several signatories of the agreement have expressed an interest in extending the agreement, the Kuwaiti Oil Minister, Essam El Mazouq, told reporters on Sunday that an extension might not be necessary if all the participants of the agreement fully comply with their commitments, the Middle East Eye reports.