OPEC Ministers consider oil cut extension to 2018

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OPEC Ministers are determined to reach a consensus to extend oil production cut till the end of 2018 to prop up global prices.

Saudi Arabia’s Energy Minister, Mr Khalid Al-Falih at the opening of the 173rd meeting of the OPEC Conference in Vienna, Austria,  said that OPEC members and allied producers are expected to agree to extend further, the supply cuts.

Al-Falih urged all members to continue to cooperate on the production cut, which he said had created stability and the right environment to protect both oil producers and consumers.

He also tasked members about climate change. He encouraged them to invest in innovations that are environmentally friendly to reduce energy-related emissions.

NAN reports that the Ministers are presently in a close door meeting which started at 11 a.m, and scheduled to last till 4 p.m.

Meanwhile, Nigeria’s Minister of State for Petroleum, Mr Emmanuel Kachikwu said that Nigeria expects to be officially included for the first time in the cut.

He recalled that it’s been a year since the OPEC and non-OPEC countries agreed to cut daily oil production by 1.8 million barrels per day.

Nigeria was exempted due to the unrest in the Niger-Delta which had impacted negatively on the country’s ability to produce up to 2.2 million barrels per day (mbd).

He said that the current oil production stands at 1.7 million barrels per day, but that before the end of the year, the production would hit 1.8 million barrels.

“Nigeria believes that they have always been included in the oil cut since we were never meeting our production target anyway.

“So even if we get a directive to cut our production to 1.8mbd, we still have our contingencies.

“To achieve the revenue projections in the budget, I think that we will still be within target, plus or minus. This is because the differentials in revenue target for the 2018 budget will be made up by good numbers.

“If you remember, the ERGP and the 2018 budget has a crude oil benchmark of 42 dollars per barrel.

“So if you compare this to the current price of 62 dollars per barrel, the differentials in terms of cut will be made up by the differentials in terms of price, so we should okay,” he said.

Energy Ministers from OPEC and non-OPEC countries including Nigeria, Libya, Saudi Arabia, Russia among others, will review the current agreement to cut daily global oil production by 1.8 million barrels per day.

OPEC and non-OPEC countries on Nov 30, 2016 agreed to make a 1.8mbp cut, with OPEC countries making the biggest cut of 1.2mbp and non-OPEC, 600,000 barrels per day.

The focus of the meeting would be to decide if there is need to deepen the cut, retain the present cut or to extend this agreement beyond the agreed dateline, which was April 2018. (NAN)

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