Will additional 1% be able to save OPEC deal?

Iraq and some other oil producers taking part in global output cuts think they should reduce supply by an additional 1% to help re-balance the market, Iraqi Oil Minister Jabbar al-Luaibi said at a conference in the emirate of Fujairah in the United Arab Emirates.

According to him, some also favor extending cuts until the end of 2018.

He said that producers are talking about what to do next regarding the cuts. There is “no firm decision yet” on further cuts or any extension of the current reductions, al-Luaibi added.

"Some think that cuts should be extended beyond March, three or four months, or six months, or maybe till the end of 2018. Some, like Ecuador and other countries, even Iraq, think there should be another cut of 1%," Bloomberg cited the minister as saying.

"Oil prices and the global market are improving, and Iraq sees a “positive trend” in crude markets. Oil demand will continue to increase in the coming two to three years," al-Luaibi said.

The executive vice-president of NewTech Services, professor of the Gubkin Russian State University of Oil and Gas, Valery Bessel, speaking with Vestnik Kavkaza, noted that the reduction in oil production of all countries participating in the OPEC deal by 1% will not affect oil prices. "The prices have already stabilized at $50-55 per barrel, and I am absolutely convinced that they will remain at this level," he explained.

"It is also important that the oil market is really saturated with oil supplies, I do not think that any country will agree to leave the market in order to free the trading platform for other competitors, because its place will be immediately occupied, and it would be incredibly hard to fight it back. Therefore, such proposals and agreements on oil production cuts will continue, but it will not lead to any significant price changes," Valery Bessel expects.