Al-Falih discusses oil output deal extension with Venezuela, Kazakhstan

Saudi Arabia’s energy minister Khalid Al-Falih has discussed with his Venezuelan and Kazakh counterparts the possible extension of the output cut deal between oil-producing nations beyond March 2018, Reuters reported on Sunday, citing an energy ministry statement.

“Both countries agreed that the option to extend the voluntary market rebalancing effort, beyond the first quarter of 2018, would be considered in due course as market fundamentals may dictate,” the ministry was quoted as saying after holding his meetings in Astana.

The news pushed oil prices higher on Monday, with Brent crude rising 0.5 percent to $54.06 per barrel (bbl), while WTI was up 0.9 percent at $47.89/bbl.

OPEC and other non-member oil producers, including Russia, have agreed to reduce supply by about 1.8 million barrels per day (bpd) until next March in a bid to reduce global oil inventories and support oil prices.

The deal, which was initially announced in December last year, pushed Brent crude prices to a peak of above $57/bbl in January. However, prices have since slipped back into a range of $50-54/bbl as it has taken longer than expected to curb the supply glut in the market.

Global crude inventories remain too high, Venezuelan oil minister Eulogio Del Pino said on Friday, cited by Reuters. He urged producers to reconsider exemptions granted to countries such as Libya and Nigeria, where output has been hit by militant attacks, and the effect of those exemptions on the market.