Nigerian oil minister unable to attend Russian Federation meeting -Kuwait minister

Robyn Ryan
July 12, 2017

But the cartel has an opportunity to increase cuts at its next compliance committee meeting on 24 July, Goldman said.

"OPEC would be producing too much if the other quotas are left unchanged", Ait-Laoussine said. That's already become harder because of the resurgence in output from OPEC members exempt from cuts, while there are no signs yet that Saudi Arabia, the group's de facto leader, is willing to cut as deeply as it did earlier in the year. United States crude oil (SCO) (BNO) (IEZ) prices have fallen 21.7% year-to-date, which motivated major oil producers to cap their production.

Oil fell from roughly $114 a barrel in 2014, to as low as $26 in 2016 as OPEC determined to let the market dictate price, betting US shale producers would fall away.

On the other side of the coin, Neil Dwane, global strategist and chief investment officer at Allianz Global Investors, believes oil production supply is threatened around the world: he told CNBC that geopolitical risks other than those in the Middle East warrant serious scrutiny. Increases from Libya and Nigeria are also diluting the impact of supply curbs.

OPEC, along with Russian Federation and some other major exporters, has agreed to hold production at around 1.8 million barrels per day (bpd) below levels pumped at the end of past year. A massive rise in production from Libya and Nigeria could offset the production cut deal.

Libya said on Monday it was ready for talks but added that its political, economic and humanitarian situation should be taken into account in talks on caps.

Crude prices are around 18% below from the levels in the beginning of this year despite Organization of the Petroleum Exporting Countries efforts to reduce production from January.

West Texas Intermediate for August delivery rose 8 cents to US$44.48 a barrel at 9.58am on the New York Mercantile Exchange.

If Libya and Nigeria are able to stabilise their output at current levels, they will be asked to cap supply as soon as possible, Almarzooq said.

Deeper cuts are now not on the agenda, according to Opec Secretary-General Mohammad Barkindo.

Other reports by VideoGamingPros

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