The 14-member cartel decided to extend the cuts in oil production until the end of 2018 to contain a global wave of crude oil. OPEC also said it could end the deal sooner if the market overheats. The agreement on the cuts, which were lower than expected, was limited to two days of meetings, centered on a rising tide of oil that has caused prices to fall by about a third since the beginning of October. “If U.S. producers increase their rig numbers in the coming months due to higher prices, I expect prices to fall again by the end of 2018,” said Scott Sheffield, Executive Chairman of Pioneer Natural Resources Co PXD. N, one of the largest producers in the Perm Basin of Texas and New Mexico, the largest U.S. oil lies. The agreement shows Russia`s new influence as an oil producer and the importance of its alliance with OPEC`s de facto leader, Saudi Arabia. Cooperation between a group of non-OPEC oil countries led by Russia and the Saudis has helped producers support prices in 2017 through deep production cuts.

(Chart: Difference in OPEC oil production between Nov 2018 and Oct 2016 – tmsnrt.rs/2RqgBMS) OPEC conference president Suhail Mohamed Al Mazrouei told reporters that Iran, which faces U.S. sanctions for its crude oil exports, would be excluded from the agreement with Libya and Venezuela. Russia`s energy minister has called for greater discipline among major oil exporters in reducing production. The goal – higher crude oil prices – is at the heart of the Kremlin with the 2018 elections. (24.07.2017) The OPEC agreement was held on hold for two days, due to fears that Russia would cut too little, and then fear that Iran, whose crude oil exports are depleted by U.S. sanctions, would not receive an exception and block the deal. The supply cuts will be the production levels of the participating countries from October 2018 and will come into effect in January until a six-month period, according to a joint statement from the agreement and its allies, known as OPEC. Not having Russia and other non-OPEC participants “would be a futile exercise,” Nigerian Oil Minister Emmanuel Ibe Kachikwu said after the hard-fought agreement. McNally was also skeptical of full compliance with the agreement and noted that, with the exception of Saudi Arabia and Russia, the distribution of the reductions was unclear.

OPEC said the outlook for global economic growth for 2019 is slightly lower than in 2018 and could have an impact on global oil demand next year. A joint statement from OPEC and non-OPEC said the next meeting in June 2018 would provide an opportunity to adapt the agreement based on market conditions. VIENNA – OPEC and a coalition of Russian-led oil producers agreed Friday to participate in a major production cut that could lead to an increase in the global inflow of crude oil. With oil prices above $60, Russia has expressed concern that a full-year extension for 2018 could lead to higher crude oil production in the United States that is not participating in the agreement. The 14 members of the Organization of Petroleum Exporting Countries, widely known as OPEC, and non-members like Russia met in Vienna on Thursday to confirm details of an existing agreement that expires in March 2018.

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