2017.11.1323:25:00UTC+00OPEC, Allies Expected to Push through with Oil Cut Extension

OPEC, along with other oil producers are on their way to deciding at their meeting at the end of the month whether to prolong a global deal to limit oil supply further into 2018, according to two ministers. The time frame is quicker than previously indicated.

The producer cartel, along with nine other producers are limiting production by around 1.8 million barrel per day in an attempt to tighten the market and are mulling to extending the agreement for a longer period of time.

Last month, Reuters reported, citing OPEC sources, that producers were likely to prolong the deal until the end of next year. However, the decision could be held off until early 2018 depending on the market, the sources said.

But UAE Energy Minister Suhail bin Mohammed al-Mazroui said he saw no necessity for the decision to be held off beyond the meeting on November 30 by OPEC in Vienna. This opinion was reiterated by Omani oil minister Mohammed bin Hamad al-Rumhi, who said that such decision will extend the supply cut until the end of 2018. He added that a deeper cut would be allowed by producers.

In OPEC's November oil market report, the cartel upgraded the projection for 2018 demand for its crude by 360, 000 bpd from the previous month's report to 33.42 million bpd. OPEC also said industrialized nations' September commercial oil reserves fell by 23.6 million barrels down to 2.985 million barrels.