OPEC, Rus­sia pre­pared to raise oil out­put amid U.S. pres­sure

Stabroek News Sunday - - WORLD NEWS -

ST PETERS­BURG/DUBAI, (Reuters) - Saudi Ara­bia and Rus­sia are dis­cussing rais­ing OPEC and nonOPEC oil pro­duc­tion by some 1 mil­lion bar­rels a day, sources said, weeks after U.S. Pres­i­dent Don­ald Trump com­plained about ar­ti­fi­cially high prices.

Riyadh and Moscow are pre­pared to ease out­put cuts to calm con­sumer wor­ries about sup­ply ad­e­quacy, their en­ergy min­is­ters said on Fri­day, with Saudi Ara­bia’s Khalid al-Falih adding that any such move would be grad­ual so as not to shock the mar­ket.

Rais­ing pro­duc­tion would ease 17 months of strict sup­ply curbs amid con­cerns that a price rally has gone too far, with oil hav­ing hit its high­est since late 2014 at $80.50 a bar­rel this month.

Trump tweeted last month that OPEC had “ar­ti­fi­cially” boosted oil prices.

“We were in the meet­ing in Jed­dah, when we read the tweet,” OPEC Sec­re­tary Gen­eral Mo­ham­mad Barkindo said, re­fer­ring to a meet­ing in Saudi Ara­bia on April 20.

“I think I was prod­ded by his ex­cel­lency Khalid Al-Falih that prob­a­bly there was a need for us to re­spond. We in OPEC al­ways pride our­selves as friends of the United States,” Barkindo told a panel with the Saudi and Rus­sian en­ergy min­is­ters in St. Peters­burg at Rus­sia’s main eco­nomic fo­rum.

OPEC of­fi­cials said by “the need to re­spond” Barkindo was re­fer­ring to a tweet he sent the same day, rather than the need to act.

The Or­ga­ni­za­tion of the Petroleum Ex­port­ing Coun­tries and al­lies led by Rus­sia have agreed to curb out­put by about 1.8 mil­lion bar­rels per day (bpd) through 2018 to re­duce global stocks, but the in­ven­tory over­hang is now near OPEC’s tar­get.

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