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EghtesadOnline: OPEC members’ compliance with the agreement to reduce output has improved in recent months, Iran’s oil minister said on Monday, noting that unofficial talks were underway among oil producing countries to extend the cuts next year.

Based on the agreement, OPEC is curbing its collective oil production by about 1.2 million bpd, while Russia and some other non-OPEC producers are cutting a further 600,000 bpd until March 2018, Reuters reported.

“I think the oil market is balanced. OPEC members’ compliance with output cuts has not fallen in the last six months; it has increased,” Bijan Namdar Zanganeh was also quoted as saying by the Iranian Oil Ministry’s news agency Shana.

The International Energy Agency said in July that OPEC’s compliance with production cuts fell in June to its lowest levels in six months, as several members pumped much more oil than allowed by their supply deal, thus delaying a market rebalancing in supply and demand, according to Financial Tribune.

However, IEA said in August that world oil demand would grow more than expected this year, helping to ease the glut in supply.

Zanganeh said the OPEC agreement on output cuts would continue until the end of the Iranian year in March 2018 and that “there are talks underway to extend it but they are not official yet”.

However, before a meeting in Tehran with Brazil’s Minister of Mines and Energy Fernando Coelho Filho, Zanganeh said, “it is improbable that Brazil (a non-OPEC country) joins the output cut under current conditions”.

He added that other non-OPEC members, especially Russia, have cooperated well with OPEC in cutting oil production.

Russian Energy Minister Alexander Novak also said on Tuesday that Russia and Saudi Arabia have discussed extending an oil output cut deal between OPEC and non-OPEC producers but no specific decision has been made.

“We met in St Petersburg and discussed such an option with Saudi Arabia—that it is possible within the framework of the signed agreements,” TASS quoted Novak as saying.

“We are considering all kinds of options. We may consider the issue of extending the OPEC-led deal if need be.”

 

Opec OPEC Compliance OPEC Output Pact oil output pact