OPEC is likely to keep its 1.2 million barrels per day of production reductions in place through the end of 2018, according to bloc sources from the Gulf who spoke to Reuters.
Another 600,000 bpd of output has been cut by Russia and nine other nations to boost the effects of the OPEC agreement. The group of non-OPEC nations have agreed to extend their cuts through March 2018 so far.
OPEC will meet at its Vienna headquarters on November 30th, marking the one-year anniversary of the industry cartel's agreement to orchestrate a solution to the global oil supply glut. The deal went into effect on January 1st, 2017.
Production in Venezuela and Iraq has been falling in recent weeks due to escalating domestic strife. U.S. sanctions and infrastructural issues put Venezuela on track to lose 240,000 bpd of production next year. The Kurdish independence referendum in Iraq has caused northern oil output to topple as the government grapples for control of the Kirkuk oilfields from the KRG. Retuers sources added that other OPEC members are unlikely to increase production to offset these under-producers.
"OPEC is likely to stay the course for the rest of 2018. We want to see commercial stocks going down," one source said. "The feeling in OPEC is that $60 (£45.2) (a barrel) should be the floor for oil prices next year."
Related: How Many Barrels Of Oil Are Needed To Mine One Bitcoin?
State-run Saudi Aramco had been aiming for a $60 barrel prior to its initial public offering, due to take place in the second half of next year. The foreign venue for the listing has yet to be announced, but New York and London are considered to be the top contenders for the financial event - to be the largest of its kind in financial history.
Saudi Arabia is the de facto leader of OPEC due to its position as the bloc's top producer. Iraq and Iran take the No. 2 and No. 3 positions.
By Zainab Calcuttawala for Oilprice.com
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Zainab Calcuttawala is an American journalist based in Morocco. She completed her undergraduate coursework at the University of Texas at Austin (Hook’em) and reports on… More
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