• 4 minutes Will We Ever See 100$+ OIL?
  • 8 minutes Iran downs US drone. No military response . . Just Destroy their economy. Can Senator Kerry be tried for aiding enemy ?
  • 11 minutes Energy Outlook for Renewables. Pie in the sky or real?
  • 27 mins Iran Loses $130,000,000 Oil Revenue Every Day They Continue Their Games . . . .Opportunity Lost . . . Will Never Get It Back. . . . . LOL .
  • 9 hours Shale Oil will it self destruct?
  • 23 hours Berkeley becomes first U.S. city to ban natural gas in new homes
  • 18 hours Iran Captures British Tanker sailing through Straits of Hormuz
  • 2 hours Renewables provided only about 4% of total global energy needs in 2018
  • 3 hours EIA Reports Are Fraudulent : EIA Is Conspiring With Trump To Keep Oil Prices Low
  • 1 day Drone For Drone = War: What is next in the U.S. - Iran the Gulf Episode
  • 2 days Today in Energy
  • 7 hours Oil Rises After Iran Says It Seized Foreign Tanker In Gulf
  • 2 days Populist, But Good: Elizabeth Warren Takes Aim at Private-Equity Funds
  • 2 days Why Natural Gas is Natural
  • 2 days LA Solar Power/Storage Contract
  • 23 hours U.S. Administration Moves To End Asylum Protections For Central Americans
Irina Slav

Irina Slav

Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.

More Info

Premium Content

OPEC And Partners Officially Ratify New Deal

Russia and the other non-OPEC members of the production cut pact first sealed in 2016 have officially ratified an extension of the latest round of cuts agreed last December, Energy Minister Alexander Novak said at the OPEC meeting in Vienna today, after crafting the details of the deal a day earlier.

CNBC reported that OPEC had agreed to extend the cuts—of a total 1.2 million bpd—until the end of March 2020 as prices stubbornly refuse to rise much above the US$60-65 band.

The news comes on the heels of earlier reports that Russia, Saudi Arabia, and Iraq had declared their support for another extension of the cuts. Iran also agreed to the extension yesterday despite the growing internal divide in the oil-exporting cartel.

The decision to extend the cuts is not particularly surprising. With relentlessly rising U.S. oil production, OPEC has few good moves left, if any. Russia has repeatedly noted it would be happy with lower oil prices than its Middle Eastern partners but even so it has once again agreed to continue cutting. Some saw in this a deal, in which the Middle Eastern partners—notably Saudi Arabia—would compensate Moscow for the inconvenience of having to sell less oil with investment contracts in energy and other sectors.

This compensation may not, however, eliminate the risk of Rosneft demanding its own compensation for production restrictions: last month chief executive Igor Sechin said the company would be seeking such compensation from the Kremlin if it agreed to support an extension of the cuts.

What is perhaps more worrying for OPEC is that oil prices reacted weakly to the news: Reuters reported earlier today Brent and WTI had both retreated from the spike that followed the initial announcement of the cuts agreement, pressured by trader worry about the prospects of the global economy in the context of the U.S.-Chinese trade war.

At the time of writing, Brent crude was trading at US$64.87 a barrel and West Texas Intermediate was trading at US$58.91 a barrel, both down from opening.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:




Download The Free Oilprice App Today

Back to homepage


Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News
Download on the App Store Get it on Google Play