Saudi oil chief urges Opec to cut output to low end of target

riyadh/doha — The energy minister for top Opec exporter Saudi Arabia said on Thursday he was optimistic about the Opec’s deal to limit oil output and mentioned the lower end of a previously agreed production target, helping spur a rally in the price of crude.

The Organisation of the Petroleum Exporting Countries, at a meeting in Algeria in September, made a preliminary deal to limit oil output. The details are meant to be finalised when Opec ministers gather in Vienna on November 30.

Saudi Energy Minister Khalid Al Falih, speaking to Saudi-owned Al Arabiya TV, said the oil market was on a path towards becoming balanced and that “reaching [a decision] to activate that ceiling of 32.5 million barrels per day will speed up the [market] recovery and will benefit producers and

I’m still optimistic that the consensus reached... will translate... into caps on states’ levels and fair and balanced cuts among countries Khalid Al Falih, Saudi oil minister

consumers”. The Opec agreed on September 28 to limit supply to between 32.5 million and 33 million bpd, with special conditions given to Libya, Nigeria and Iran, whose output has been hit by wars or sanctions. Al Falih and other ministers have said previously that the Opec would reduce output to that range, without specifying the higher or lower end.

Oil prices climbed above $47 a barrel on Thursday as comments from Al Falih and other ministers boosted expectations that the Opec would complete the deal.

“I’m still optimistic that the consensus reached in Algeria for capping production will translate, God willing, into caps on states’ levels and fair and balanced cuts among countries,” Falih said.

A number of Opec energy ministers, including Al Falih, are expected to meet informally in Doha on the sidelines of a gas exporters’ conference to try to build consensus.

Algeria’s Energy Minister Nouredine Bouterfa said the issue of Iran’s production would not undermine a deal.

“There is strong consensus among Opec producers for a freeze,” he told Reuters.— Reuters