Opec members to meet to discuss extending production cuts

Have you read Trendiee Today? Exports of refined products (gasoline, diesel fuel, etc.) rose to almost 4.5 million barrels a day last week.

Thursday’s unease among the trading community coincides, ironically, with news that Total SA, Vitol Group, and Mercuria Energy Group Ltd. are selling crude they hoarded in Saldanha Bay, South Africa, (one of the world’s largest crude storage facilities) as the physical market tightens due to booming demand.

OPEC and its allies have been considering extending the deal beyond the end of March.

While OPEC-led cuts have started to drain supplies, rising crude prices have encouraged USA shale oil producers to ramp up output, filling some of the gap left by the cuts.

Saudi Arabia, Russia and others are aware that their production cuts are not going to increase oil prices much beyond where they are now. The pact runs to the end of March.

At the time of writing, OPEC had not yet issued the official statement on the state of the oil market, but ministers at the meeting said that the cuts were clearing the glut, Reuters reports.

Both contracts have risen more than 15 percent over the last three months as global oil supply has tightened.

Russia, which relies on energy for more than a third of its budget revenue, saw its economic growth accelerated to the fastest pace in nearly five years in the second quarter amid recovery in oil prices and domestic consumption. Kuwaiti Oil Minister Essam al-Marzouq said that there was no need to decide now that the market was “well on its way toward rebalancing”.

Last week, Pradhan told reporters here that the government can not change fuel prices on a knee-jerk basis after stocks of state-run oil marketing companies tanked by as much as eight per cent following recent hikes in transport fuel prices.

It’s in OPEC’s interest to wait before pledging to extend its cuts, Goldman Sachs Group Inc. said in a note dated September 21. That is up from 94 percent in July.

The Russian minister said ministers would also discuss monitoring exports, although he said the main focus was still on production. He did not comment on arrival in Vienna on Thursday.

At this its 5th meeting, the JMMC welcomed the participation of Iraq, Libya and Nigeria, and the reaffirmation of their commitment to ensure the success of the Declaration of Cooperation.

He also said that although Nigeria was not a member of the five nation JMMC, the country was in support of and had confidence in the work of the committee to stabilise the market.

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