Mar­ket Con­di­tions to De­ter­mine Any Ex­ten­sion of OPEC-Led Cut Deal

Iran News - - INTERNATIONAL -

KUWAIT (Dis­patches) - Kuwait’s oil min­is­ter said on Mon­day a pact be­tween OPEC and non-OPEC pro­duc­ers to curb sup­plies would run to the end of the year and mar­ket con­di­tions would de­ter­mine whether to ex­tend it be­yond the end of 2018.

Bakhit al-Rashidi also said the meet­ing of the Or­ga­ni­za­tion of the Pe­tro­leum Ex­port­ing Coun­tries in June in Vi­enna would of­fer a chance to re­view the deal, adding that oil mar­kets were head­ing in the right di­rec­tion for sta­bil­ity.

“The agree­ment will con­tinue un­til end of this year,” the min­is­ter told re­porters at an oil in­dus­try event in Kuwait.

He added that “it would de­pend on mar­ket con­di­tions whether to ex­tend this agree­ment be­yond 2018 or to reach a per­ma­nent agree­ment be­tween OPEC and nonOPEC to sup­port mar­ket sta­bil­ity,” say­ing this is­sue would be re­viewed later in the year.

An ini­tial draft of a longer-term al­liance be­tween OPEC and non-OPEC oil pro­duc­ers would be dis­cussed at the June meet­ing, OPEC Sec­re­tary-Gen­eral Mo­ham­mad Barkindo said last week.

OPEC, Rus­sia and sev­eral other non-OPEC pro­duc­ers be­gan to cut sup­ply in Jan­uary 2017 in an ef­fort to lift oil prices. The pact runs un­til the end of this year, and the June meet­ing will see par­tic­i­pants de­cide their next course of ac­tion.

A sur­plus in global oil in­ven­to­ries was close to evap­o­rat­ing, OPEC said last week, cit­ing healthy en­ergy de­mand and its own sup­ply cuts. It also re­vised up its fore­cast for out­put from ri­vals who have ben­e­fited from higher oil prices.

OPEC has a self-im­posed goal of bring­ing oil in­ven­to­ries in in­dus­tri­al­ized coun­tries down to their five-year av­er­age.

Barkindo said in Kuwait on Mon­day that oil stocks in the de­vel­oped world fell in Fe­bru­ary to be­low 50 mil­lion bar­rels above the lat­est five-year av­er­age and that the de­clin­ing trend would con­tinue over the com­ing months.

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