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SAUDI ARABIA - Major oil producers are set to pump about 1m more barrels a day to help cool crude prices as part of an Opec deal, according to Saudi Arabia’s energy minister.
Khalid al-Falih said he was hopeful an agreement would be reached yesterday, minutes after meeting Iran, which has been the key holdout to a rise in output. Delegates privy to the negotiations in Vienna told the Guardian talks had been fraught but they thought the cartel could maintain unity despite divisions. “An agreement was reached yesterday to release the equivalent of about 1m barrels to the market it will be distributed pro rata,” Falih said on Friday, of an Opec committee meeting on Thursday. The deal has not been formally signed off yet, however. “Saudi Arabia is unique. All of our spare capacity is available at short notice,” he said. He acknowledged not all of the cartel’s members could increase output, in a reference to countries such as Venezuela. Falih said the world should not expect the impact to be felt until the end of summer because crude would take weeks to reach markets. Opec and Russia have come under pressure from the US, China and India to boost production, with India’s oil minister in Vienna this week complaining about the impact of prices on consumers.
Iraq’s energy minister said it was clear that Opec and its allies would change course after 18 months of production curbs, in an effort to rebalance crude supply and demand. Asked if there would be an increase in supplies, Jabbar Alluaibi said: “Definitely a change.” After nearly two years of relative unity, the talks in Vienna this week have found Opec divided. After arriving on Tuesday, the Iranian oil minister, Bijan =anganeh, threatened to veto a Saudi and Russian-led drive to raise output, and observers said “the body language has been awful”. The Ecuador oil minister, Carlos Pprez, when asked if the talks had been fractious, said: “It’s been a difficult situation.” However, he added the cartel hoped to continue its unity despite the disagreements.
(The Guardian)