“We should all remember that as Saudi Arabia draws closer to the later part of 2018, the announced time of Saudi Aramco’s highly anticipated IPO, it is in the Saudi’s best interest to move oil markets back toward the $100 level. Although history has shown that OPEC members can be less than agreeable on production policy, this time may well be different. The top three producers of oil, Saudi (higher with OPEC), Russia and US can tip the oil prices either up or down depending internal strategies.”
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OPEC and other oil producers taking part in output cuts have reached a consensus to extend the limits until the end of the year, oil ministers for two of the group’s members said.
All members of the Organization of Petroleum Exporting Countries support an extension of the cuts for a second six-month period, as do non-member nations that joined last year’s accord to curtail a global oversupply of crude, Iraq’s Jabbar Al-Luaibi and Algeria’s Noureddine Boutarfa said Thursday in a joint news conference in Baghdad.
“The decision to decrease output will be for six months, and Algeria and Iraq maintain a united stand for the next cuts,” said Boutarfa, who hosted the OPEC meeting in September 2016 where the cuts were first agreed in principle. Iraq is OPEC’s second-biggest producer.
OPEC will decide formally whether to extend the cuts when its ministers meet in Vienna on May 25. The producer group and other major suppliers including Russia agreed last year to cut their collective production by about 1.8 million barrels a day for the first half of 2017 in an effort to reduce bloated global stockpiles and re-balance the market. The agreement included a provision to extend the cuts for a further six months if necessary, subject to a unanimous decision. (by by Kadhim Ajrash , Khalid Al Ansary and Sam Wilkin, Bloomberg)