OPEC, Russia Renegotiate Production Cut Agreement

OPEC, Russia Renegotiate Production Cut Agreement

Russia will withdraw from the production cut agreement with Organization of the Petroleum Exporting Countries (OPEC) if oil prices remain at $70 per barrel for six months, stated Vagit Alekperov, Russian Lukoil’s CEO, according to Reuters.

“If the price of $70 remains for more than half a year, we should start exiting smoothly,” Alekperov told reporters.

Additionally, the Iranian Oil Ministry gave a warning that US increasing output would be wrecking OPEC’s efforts, Bloomberg informed.

Although the increasing oil price could be good news for oil producers, it might motivate oversupply from shale drillers in US, Head on the International Energy Agency, Fatih Birol, pointed out.

Meanwhile, the Russian CEO announced oil price ranging between $60 per barrel and $70 per barrel is suitable for Russian oil companies. “We should not repeat the mistakes of 2000s when the oil price crossed over $100,” he added.

Ministers from Kuwait, Iraq, and the United Arab Emirates stated that there is no need to change the supply cut strategy and announced that they will commit to the plan to reduce production for the rest of 2018.

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Sarah Samir 3670 Posts

Sarah has been writing in the oil and gas field for 8 years. She has a Bachelor Degree in English Literature. She has three years of experience in the banking sector.

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