Withdrawing from the OPEC-NOPEC agreement to cut 1.8 million barrels per day of output could take up to six months to fully negotiate, according to top Russian energy official Alexander Novak.
"This is a process to be discussed. It can take three months or half-year. A specific moment of time to be considered, depending on the future demand," the minister said.
Novak said discussing a premature withdrawal did not reflect any desire within the Russian leadership to abandon the deal, which, over its lifetime in 2017, has allowed the Brent barrel price to recover to $60+.
Last week, OPEC and its non-OPEC partners agreed to extend the deal through the end of 2018, but the team included a review clause that would take place in June. It is unclear whether countries will have the ability to leave the pact at that point.
Libya and Nigeria will face a combined cap of 2.8 million BPD starting in January.
The deal extension is sending a stronger signal that the oil market rebalancing could speed up and send WTI oil prices to average $54.78 a barrel in 2018, up from a previous projection of $52.50, a Reuters poll of 30 analysts and economists showed on Wednesday. The experts surveyed now expect Brent Crude to average $58.84 a barrel next year, compared to a forecast of $55.71 per barrel for 2018 in the previous Reuters poll conducted at the end of October.
Related: Oil Markets Calm After OPEC Storm
While some of the experts surveyed by Reuters expect OPEC to keep compliance high because the individual producers need higher oil prices to cut budget deficits, others express lingering doubts about the resolve of the group of non-OPEC nations to stick to pledges, especially the leader of that group, Russia.
Apart from the production cuts, OPEC and its partners are hoping that robust demand growth will help them to cut down global inventories to their five-year average.
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