VIENNA: Opec and Russia look set to prolong oil supply cuts until the end of 2018 this week while signalling that they may review the deal when they meet again in June if the market overheats.
With oil prices rallying above $60 per barrel, Russia has questioned the wisdom of extending existing cuts of 1.8 million barrels per day until the end of next year as such a move could prompt a spike in US production.
Russia needs much lower oil prices to balance its budget than Opec’s leader Saudi Arabia, which is preparing a stock market listing for national energy champion Aramco next year and would hence benefit from pricier crude.
Six ministers from Opec and non-Opec oil producers including Saudi Arabia and Russia will gather in Vienna on Wednesday — one day ahead of a full Opec meeting — to review recommendations by their delegates.
On Tuesday, a joint Opec/non-Opec committee recommended extending cuts until the end of 2018 with an option of reviewing the arrangement at the next Opec meeting in June, three sources from Opec said. — Reuters
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