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OPEC and non-OPEC countries to continue talks on oil production cut deal

September 22, 17:28 UTC+3 VIENNA

The extension of the oil production cut deal may be discussed in 2018, according to the Russian energy minister

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© Vladimir Smirnov/TASS

VIENNA, September 22. /TASS/.The OPEC + countries have left all options for further implementation of the agreement on oil production reduction open for discussion, according to the communique of the Joint Ministerial Monitoring Committee (JMMC).

The next meeting of the committee will be held on November 29.

"The JMMC will continue to monitor other factors in the oil market and their influence on the ongoing market rebalancing process. All options are left open to ensure that every effort is made to rebalance the market for the benefit of all," the document says.

The OPEC Monitoring Committee will once again discuss the parameters of the Vienna agreement on cutting the volume of oil production by the OPEC countries and the countries outside of the organization, including the issue of monitoring oil exports, according to the Minister of Petroleum of Venezuela Eulogio del Pino.

According to the Minister, parameters of the Vienna agreement will be confirmed at the meeting.

Russian Energy Minister Federation Alexander Novak reporters on the sidelines of the Eastern Economic Forum he considers it possible to change the terms of the OPEC+ deal to reduce oil production. "Everything is possible, if the opportunity appears to change the conditions - we will discuss the issue," he said.

Agreement extension

Novak considers it possible to take the final decision regarding the extension of the OPEC+ crude production cut deal not earlier than in the first quarter of 2018.

"We discussed future plans and the extension of the deal if needed. However, this decision should be made later, most probably in the first quarter of next year," he said. Members of the OPEC+ agreement on crude production cap note lower volatility on the oil market, he said, adding that oil prices are 30% higher versus the first half of last year. "We evidence lower volatility on the market, and the price of Brent crude oil 30% higher in the first half of 2017 versus the first half of 2016," he said.

100% compliance rate

 The compliance rate of the OPEC+ agreement on oil production cap amounted to 99% for eight months of this year, he went on. 

"The total rate amounted to 99% for eight months since the agreement came into force, which is an unprecedentedly high level," he said.

The monitoring committee of the OPEC and non-OPEC nations has urged those participants of the oil production cap deal that do not fully comply with the terms of the agreement, to bring their compliance rate to 100%. "We discussed (at the meeting of the committee) the existing reserve due to certain countries being potentially able to reach a higher level, up to 100%. We urged those countries to meet a respective compliance level," he said.

Libya, Nigeria ready to reduce oil output

Libya and Nigeria are ready to freeze crude production at the current level or reduce it by 2-3%, Novak said.

"Our colleagues (from Libya and Nigeria - TASS) said at the meeting of the monitoring committee today, that they are ready to freeze and even join the agreement to reduce production by 2-3% once they reach certain output level," he said.

According to Novak, if the two countries freeze crude production for a certain period of time, it could become a shrewd move for them to join common efforts to bring the oil market back to balance.

"Today we discussed it not from the viewpoint of decision-making, but from the viewpoint of existing options. And if it is needed we can always get back to the issue. But today I don’t think the time is ripe for such a decision," he said.

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