• 2 minutes Oil Price Could Fall To $30 If Global Deal Not Extended
  • 5 minutes Iran downs US drone. No military response . . Just Destroy their economy. Can Senator Kerry be tried for aiding enemy ?
  • 8 minutes The Inconvenient Truth Of Electric Cars
  • 5 hours Here we go folks, the wish of so many: Pres. Trump threatens to lessen US security role in Strait of Hormuz, unveils sanctions
  • 4 hours To be(lieve) or Not To be(lieve): U.S. Treasury Secretary Says U.S.-China Trade Deal Is 90% Done
  • 28 mins Magic of Shale: EXPORTS!! Crude Exporters Navigate Gulf Coast Terminal Constraints
  • 28 mins SHALE MAGIC: Let the oil flow: US to lead oil output growth through 2030: ConocoPhillips chief economist
  • 5 hours Looks like Trump is putting together a "Real" Coalition to protect Persian shipping lanes. Makes perfect sense. NO Fake "Coalition's of the Willing" UPDATE REUTERS Pompeo "Sentinel Program"
  • 2 hours The Plastics Problem
  • 17 hours Here We Go: New York Lawmakers Pass Aggressive Law To Fight Climate Change
  • 18 hours The Strait of Hormuz is the world’s most important oil transit chokepoint
  • 13 hours Hard To Believe: UAE Will Work To Defuse Middle East Tension
  • 7 hours Cap and trade: What could Oregon’s carbon policy cost you?
  • 4 mins On the hobby side of things
  • 19 hours Climate change & Wildfires: More Wildfires To The Western U.S., Will Affect Tens Of Millions Of People
  • 11 hours Oil Demand Needs to Halve: Equinor
Zainab Calcuttawala

Zainab Calcuttawala

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 Info

Russia To Discuss Possible Exit From OPEC Deal

Russia

Russia may be on its way out of the OPEC output reduction deal, according to the country’s Energy Minister, Alexander Novak.

Reuters reports that Novak might discuss the country’s potential exit from the pact in Oman next week. Russia had vowed to cut output by 300,000 barrels per day under the agreement as part of a group of non-OPEC producers who elected to coordinate the bloc’s market stabilization initiative.

 “We see that the market is becoming balanced. We see that the market surplus is decreasing, but the market is not completely balanced yet and, of course, we need to continue monitoring the situation,” Novak said.  Russian oil majors have been complaining about the deal and how it is creating stumbling blocks on the road towards the industry’s expansion plans. 

Brent barrel prices are currently approaching $70 a barrel, suggesting crude markets are rebalancing as we approach June, when the deal is set for “review” – a process with little description in the full text of the OPEC deal’s renewal, which was agreed upon in November.

As far as OPEC members are concerned, the deal could carry on beyond the end of 2018. Speaking to CNBC, the United Arab Emirates’ energy minister, Suhail al-Mazrouei said: "I am expecting that this group of countries that stood and have become responsible for helping the market to correct, (that) there is a very good chance that they could stick together and put a shape around that alliance."

His statement comes amid a variety of scenarios on how the deal might come to an end, featuring civil unrest in Venezuela and Iran that may lead to supply disruptions; Russia pulling out of the pact in June; OPEC members and other parties to the deal starting—or continuing—to cheat; and oil prices rising too high.

By Zainab Calcuttawala for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment
  • Neil Dusseault on January 13 2018 said:
    Russia will pull out of the deal because they were never a member of OPEC, but rather 'NOPEC'.

    Russia's own energy minster (H.E. Alexander Novak) has repeatedly said that Russia can function just fine with oil at $40/bbl.

    With WTI between $64 and $65/bbl and Brent recently topping $70/bbl, that is $24 - $30 (or 60% - 75%) pricing above what they are comfortable with.

    So then, why wouldn't they want to exit from the OPEC deal?

Leave a comment

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