OPEC Might Extend Output Cut Deal

OPEC Might Extend Output Cut Deal

The Organization for Petroleum Exporting Countries (OPEC) could extend its oil output cuts to the end of 2017, provided other producers continue to cooperate on the deal, CNN Money reported.

Kuwait’s Oil Minister, Issam Almarzooq, commented: “If we continue to see the current level of prices and the commitment of the community, as well as non-OPEC at a satisfactory level, I think we could renew it for another six months,” according to Seeking Alpha. While Saudi Arabia’s Oil Minister, Khalid al-Falih, said all parties have shown willingness to extend if necessary.

This came as in December some countries outside OPEC , which included Russia, Mexico, and Kazakhstan, agreed to join OPEC members in their effort to restrain supply. However, skepticism remains. Since 1989, OPEC has hammered out numerous production cuts just like the one it negotiated in 2016. And in that period, OPEC producers have pumped more oil than their quotas in all but a handful of months.

The promised cuts have already pushed oil prices higher, and that is stimulating investment and production elsewhere, complicating the task for OPEC and its non-OPEC allies. Moreover, shale oil producers in the US are taking advantage. The special envoy for international energy at the US state department, Amos Hoghstein, said they have increased output by 300,000b/d since October.


Welcome! Login in to your account

Remember me Lost your password?

Don't have account. Register

Lost Password