Russia says oil cuts may be extended amid high compliance

“The chances remain high for an extension to the supply cuts, as long as there are more stockpile withdrawals”, he said. However, members said they would request a review of the agreement in April and consider recommending an extension. Others had anticipated that the soonest the cartel might make such a decision would be at its 172 meeting in Vienna on May 25.

Analysts at JBC Energy said in a report about Sunday’s talks, “We would see the relative lack of reaction in the price perhaps as a reflection of some disappointment that nothing more concrete was forthcoming”.

There is growing momentum that an agreement between OPEC and non-OPEC members to curb oil production output be extended another six months in the hopes of re-balancing falling prices. In comments made in Kuwait, Russia’s TASS news agency quoted Novak as saying discussions on extending the cuts continue.

In November last year, OPEC and other producers, including Russian Federation agreed to cut output by about 1.8 million barrels per day (bpd) in an effort to combat the oversupply issue that has pressured prices over the last two years. As of March 24, data from Baker Hughes (NYSE:BHI) put the total number of USA rigs at 809, up 20 compared to the prior week and a staggering 345 compared to the same time past year.

OPEC and non-OPEC producers said today at a meeting in Kuwait they were looking into extending an output cuts deal aimed at stabilising the market, as compliance with the milestone pact increases. While some individual ministers voiced support for an extension, the group’s final statement only said it should be studied.

Oil prices peaked at over $100 a barrel in mid-2014, before sinking below $30 in early 2016. Oman, unlike Venezuela, isn’t a member of the Organization of Petroleum Exporting Countries (OPEC). However, crude oil prices fell 14.6% YTD. The agreement to cut output has been successful so far, but should be continued into the third quarter when demand typically peaks, he said.

Opec Secretary-General Mohammed Barkindo is investigating whether the deal needs to be extended, Iraqi Oil Minister Jabar Ali al-Luaibi told reporters on Sunday before the meeting.

Concerns surrounding USA over-supply were never far from the surface and crude closed the United States session significantly off the highest levels of the day with WTI around $48.30 from a peak near $48.70.

Information for this article was contributed by Elena Mazneva, Sam Wilkin, Angelina Rascouet and Mohammed Aly Sergie of Bloomberg News.