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By Liz Hampton, Ruthy Munoz
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HOUSTON (Reuters) – Russia and Iraq said on Monday it was too early to discuss an extension of a historic deal to curb oil output beyond June while cash-strapped Angola supported the move to boost oil prices.
Members of the Organization of the Petroleum Exporting Countries (OPEC) including Iraq and non-OPEC countries such as Russia last year agreed to cut oil production by some 1.8 million barrels per day (bpd)for six months beginning Jan. 1 to reduce global oil supplies that have weighed on prices.
On Tuesday, all eyes will be on Saudi Arabia’s Energy Minister Khalid al Falih who is scheduled to speak at the CERAWeek energy conference in Houston. Falih met his Russian counterpart, Alexander Novak, on Monday and the two voiced satisfaction with the deal so far. He also met with Exxon Mobil Corp CEO Darren Woods, an industry source said. An Exxon spokesman declined to comment.
“It’s premature to talk about extending the agreement,” Novak told reporters on Monday.
Russia agreed to cut its output by 300,000 bpd under the deal, and would reach that target by the end of April, Novak said in remarks translated from Russian. So far, Russia has cut about half of that, he said.
Iraqi Oil Minister Jabar Ali al-Luaibi also was cautious on the possibility of an extension.
“It’s very premature to talk about any changes or to predict anything,” Luaibi said.
Iraq, which seeks to sharply increase its output by the end of the decade, would participate in cuts if OPEC extended the agreement beyond June, he added.
Iraq agreed to cut its production by 210,000 bpd as its part of the bargain in November.
Russia led the non-OPEC producers that joined the deal, which has lifted global oil prices more than 10 percent since November.
Russia expects oil prices to stay at between $55 to $60 per barrel in 2017, he said. Benchmark Brent crude settled at $56.01 a barrel on Monday.
Saudi Arabia said last week it would like to see oil prices rise to $60 per barrel in 2017.
Angola, which agreed to cut 80,000 bpd under the November agreement, would welcome an extension of the six-month deal, said the chief executive of Sonangol, the West African nation’s state-run oil company.
“We feel that there is a great deal of upside (to the cuts) and it was about time OPEC had an agreement,” CEO Isabel dos Santos told Reuters.
“If an extension came along, we would comply with it… Considering the current environment, it could be positive.”
Russia has been the subject of Western economic sanctions for its annexation of Crimea and conflict in Ukraine. In December, former President Barack Obama authorized expanded U.S. sanctions against Russia for intervening in the U.S. election.
It is unclear if those sanctions will remain in place under President Donald Trump, an advocate for more cooperation between the United States and Russia.
Novak said there was lots of “untapped potential” for Russia and the United States to cooperate on energy matters.
Reporting by Liz Hampton and Ruthy Munoz; Writing by Simon Webb and Ron Bousso; Editing by Leslie Adler and Lisa Shumaker
Our Standards: The Thomson Reuters Trust Principles.
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