OPEC set for oil cut extension if Iran endorses pact

      Published on Monday, 1 July , 2019      1195 Views     
OPEC set for oil cut extension if Iran endorses pact

  • Business

OPEC and its allies look set to extend oil supply cuts next week at least until the end of 2019 as Iraq joined top producers Saudi Arabia and Russia on Sunday in endorsing a policy aimed at propping up the price of crude amid a weakening global economy.




Iran is the only major OPEC nation yet to have spoken publicly about a need to extend production cuts.

Tehran has in the past objected to policies put forward by arch-rival Saudi Arabia, saying Riyadh was too close to Washington.

The United States is not a member of OPEC, nor is it participating in the supply pact.

Washington has demanded Riyadh pump more oil to compensate for lower exports from Iran after slapping fresh sanctions on Tehran over its nuclear programme.

OPEC and its allies led by Russia have been reducing oil output since 2017 to prevent prices from sliding amid soaring production from the United States, which has become the world’s top producer this year ahead of Russia and Saudi Arabia.

Fears about weaker global demand as a result of a U.S.-China trade spat have added to the challenges faced by the 14-nation Organization of the Petroleum Exporting Countries in recent months.

Russian President Vladimir Putin said on Saturday he had agreed with Saudi Arabia to extend existing output cuts of 1.2 million barrels per day, or 1.2% of global demand, by six to nine months – until December 2019 or March 2020.

Saudi Energy Minister Khalid al-Falih said the deal would most likely be extended by nine months and no deeper reductions were needed.

“It’s a rollover and it’s happening,” Falih, whose country is the de facto leader of OPEC, told reporters.

Warren Patterson, head of commodities strategy at Dutch bank ING, said OPEC had more to lose by not extending the deal.

“It comes down largely to fiscal breakeven oil prices – the Saudis have a breakeven price of around $85 per barrel, and so they will be concerned about potentially a widening gap between this level and where the market trades,” he said.



Benchmark Brent crude has climbed more than 25% since the start of 2019 to $65 per barrel. But prices could stall as a slowing global economy squeezes demand and U.S. oil floods the market, a Reuters poll of analysts found.

Keywords:
Category Business | 2019/07/01 latest update at 11:00 PM
Source : Euronews | Photocredit : Google
1196 Views
Comments Add comment



Gulf Media

Related Articles

The editorial staff of Saudi Arabia Today would like to give all of its readers from Gulf and Saudi Arabia and the whole world the opportunity to participate actively in the development of the website! If you have something interesting, fun, scandalous - just something worth to be seen from more people. Capture it and share it in the Saudi Arabia Today with a short text.

Do you have information you want to reach our readers?

Send article/s

You can subscribe to our Facebook, Twitter and Google pages or use our RSS feed channel to always read the most important news about Saudi Arabia, the Gulf and the world.


Sponsored Publications



Saudi Arabia pledges full support to Greek Cypriot administration King

Saudi Arabia pledges full support to Greek Cypriot administration

Saudi Arabian Foreign Minister Prince Faisal bin Farhan al-Saud expressed full support for the Greek Cypriot administration amid…

Saudi Cabinet voices support for the territorial sovereignty of Cyprus Government

Saudi Cabinet voices support for the territorial sovereignty of Cyprus

Saudi Arabia has voiced its support for Cyprus’ territorial sovereignty amid growing tensions following the discovery of oil…

How G20 presidency is likely to deliver Saudi economic boost Government

How G20 presidency is likely to deliver Saudi economic boost

Saudi Arabia becoming the first Arab nation to take over the G20 presidency is likely to deliver a…

Saudi Arabia offers ‘full support’ to Cyprus amid Eastern Mediterranean tensions Government

Saudi Arabia offers ‘full support’ to Cyprus amid Eastern Mediterranean tensions

Saudi Arabia’s King Salman received on Sunday the Cypriot Foreign Minister Nikos Christodoulides. They discussed bilateral relations between…

GULF TV

Popular in GULF TV

Saudi Crown Prince Wife|Why Not with him In the Foreign Tour’s

2777 Views

Saudi Crown Prince Wife Princess Sara bint Mashoor, Why Not with him In the Foreign Tour’s. Prince Mohammed…

Latest videos in GULF TV

Events

Lifestyle

Culture

Sport

Science & Technology

Government