Oil producers to draft long-term deal by 2018-end, says UAE Energy Minister

Oil producers, led by Saudi Arabia and Russia aim to draft an agreement on a long-term alliance by the end of this year, United Arab Emirates energy minister Suhail al-Mazroui told the local National newspaper on Thursday.

OPEC is urging its members to build oil capacity buffers to temper any wild upswings in price due to the weak U.S. dollar this year, he also said.

OPEC and non-OPEC producers are cutting output to prop up prices under a deal that is set to expire at the end of 2018. Saudi Arabia said last month that the producers aimed to continue cooperating beyond the end of this year.

The charter for this long-term alliance is a work in progress, but a draft framework might be endorsed and signed by all 24 countries before the end of the year, he said.

Al-Mazroui, who is also OPEC’s current president, didn’t share additional details on this framework.

“That buffer is [to assure] that if you have a surge [in demand] or issue in one of the countries you can replace that in the market and achieve a short and medium-term re-balance of the market," he was quoted as saying.