• 8 minutes U.S. Shale Oil Debt: Deep the Denial
  • 13 minutes WTI @ $75.75, headed for $64 - 67
  • 16 minutes Trump vs. MbS
  • 44 mins Knoema: Crude Oil Price Forecast: 2018, 2019 and Long Term to 2030
  • 46 mins Nuclear Pact/Cold War: Moscow Wants U.S. To Explain Planned Exit From Arms Treaty
  • 50 mins Why I Think Natural Gas is the Logical Future of Energy
  • 1 hour Merkel Aims To Ward Off Diesel Car Ban In Germany
  • 3 hours A $2 Trillion Saudi Aramco IPO Keeps Getting Less Realistic
  • 11 hours Get on Those Bicycles to Save the World
  • 1 day The Dirt on Clean Electric Cars
  • 17 hours Can “Renewables” Dent the World’s need for Electricity?
  • 1 day Owning stocks long-term low risk?
  • 20 hours Closing the circle around Saudi Arabia: Where did Khashoggi disappear?
  • 7 hours Long-Awaited Slowdown in China Exports Still Isn’t Happening
  • 11 hours Can the World Survive without Saudi Oil?
  • 17 hours Satellite Moons to Replace Streetlamps?!
Alt Text

Goldman Sachs: This Is The Next Big Risk For Oil

Goldman Sachs commodities expert Jeffrey…

Alt Text

Oil Experts Divided As Iran Sanctions Loom

The world’s top oil trading…

Alt Text

Oil Prices Subdued, But For How Long?

Oil prices may have closed…

Irina Slav

Irina Slav

Irina is a writer for the U.S.-based Divergente LLC consulting firm with over a decade of experience writing on the oil and gas industry.

More Info

Trending Discussions

Should OPEC Extend The Production Cut Deal?

Saudi Arabia’s Energy Minister Khalid al-Falih has discussed with his Venezuelan and Kazakhs counterparts the option of extending the crude oil production cut deal beyond the March 31, 2018 deadline, the ministry said yesterday, as quoted by Reuters.

The report comes after last weeks’ media quoted Russia’s Energy Minister, Alexander Novak, as saying the option for another extension was on the table. Novak added, however, that it is too early to talk about anything definitive.

The initial OPEC-non-OPEC agreement pushed Brent prices up to almost US$57 a barrel and WTI to over US$54 a barrel in January this year, but since then, the benchmarks have been sliding down, with a few notable interruptions of the trend thanks to supply disruptions and the May decision to extend the cuts beyond the original deadline of June 30, 2017.

A growing number of analysts, however, are of the opinion that OPEC is digging itself into a deeper hole the more it extends the production cuts. Lower output from the cartel’s members means lower exports and, consequently, lower crude oil revenues. It is also costing them market share to rivals, including partner Russia and the U.S.

This loss will be difficult to recoup, analysts believe, so it might be more sensible for the low-cost producers in the Middle East to quit trying to prop up prices by curbing production. Instead, returning to growing production might do the trick by pressuring prices to a level where U.S. shale producers can’t keep pumping.

It’s questionable whether these OPEC members would be willing to make the U-turn. The latest export and floating storage data suggest the global glut is beginning to ease, albeit slowly. OPEC’s August exports were lower than July’s, even though they remained above the average monthly for 2016. Floating storage, according to Kpler, hit the lowest since 2015 over the 30 days to September 8, marking a 27-percent decline over the period. Even so, prices remain much lower than where OPEC and its partners hoped they would be following the deal.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:




Back to homepage

Trending Discussions


Leave a comment
  • Brandon on September 11 2017 said:
    Likely. Market balancing does not truly need extension, but Aramco does.

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News