Al-Falih "Confident" on Oil Deal Extension to End of 2017, "Possibly Beyond"

by Ship & Bunker News Team
Monday May 8, 2017

With the spectre of surging US shale output evidently negating Organization of the Petroleum Exporting Countries (OPEC) efforts to reduce the global oil glut, sending crude prices last week under $50/bbl in the process, Saudi energy minister Khalid al-Falih Monday said he was confident the current oil output deal will be extended.

"Based on the consultations I have had with participating members I am rather confident the agreement will be extended into the second half of the year and possibly beyond," Bloomberg quoted Al-Falih as saying, who was speaking at the Asia Oil and Gas Conference in Kuala Lumpur.

"The producer coalition is determined to do whatever it takes to achieve our target of bringing stock levels back to the five-year average."

Over the weekend Reuters also reported Al-Falih had taken to Twitter to announce Brunei's energy minister Mohammad Yasmin Umar had expressed his nation's willingness to extend the oil reduction agreement, and "to support the stability of the oil market."

Meanwhile, Iran says it will go along with the OPEC consensus when the cartel meets later this month to decide if the deal will be extended beyond June.

"All indications are that the members want a renewal of the deal and we will go along with what they agree upon," Bloomberg quoted the country's Oil Minister Bijan Namdar Zanganeh as saying Saturday during an energy trade show in Tehran.

Zanganeh added he believes the non-OPEC nations who are part of the oil cutback deal would also extend their cuts.

The comments will presumably be of little surprise to the many who last week expressed confidence that the crude cutback initiative is almost certain to be extended until the end of this year, although FGE founder and chairman Fereidun Fesharaki notably went one step further and called for the deal to run until as late as the end of 2018.