OPEC extends oil cut for 9 months
OPEC agreed to maintain its cut of around 1.2 million barrels/day for nine more months while the non-OPEC members are likely to be proposed to cut output by 600,000 barrels/day, except Nigeria and Libya which are exempt from the oil cut decisions due to the ongoing political conflicts within countries.
Saudi oil exports were also reported to be planned to decline as of June in order to speed up the efforts to rebalance the market.
On Thursday, upon the group’s statement that they will not deepen the cuts or extend them as long as 12 months for now, crude oil futures started to decline with NYMEX falling $2.46/barrel to settle at $48.90/barrels and Brent falling $2.50/barrels to settle at $51.46/barrel. However, both futures are trading above the yesterday’s settlements in intra-day sessions.
The reports revealed that OPEC also faces the challenge that pushing the oil prices too high might cause the US, the world’s top oil consumer and Saudi Arabia and Russia’s rival, to increase its shale production further to meet its demand.
The group’s next meeting will be held in Vienna on November 30, 2017.
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