OPEC and its allies will discuss whether there is a need for deeper cuts in oil production when they hold a ministerial meeting on Thursday, Iraq’s oil minister said.
The Organization of the Petroleum Exporting Countries and allied producers led by Russia, a grouping known as OPEC+, agreed last year to cut oil supply by 1.2 million barrels per day (bpd) to support prices. The cuts came into effect on January 1.
Iraqi Oil Minister Thamer Ghadhban said that when OPEC and its allies met in June “there was this common understanding that perhaps six months since January are not enough (time) to assess the cut that we have introduced and we need two more months.”
“That’s why this meeting is going to be held tomorrow, to see should we continue with this cut or should we introduce a deeper cut,” he said on Wednesday. “It’s not a unilateral decision, it is a common decision.”
The OPEC+ joint ministerial monitoring committee, known as JMMC, meets on Thursday in Abu Dhabi on the sidelines of an energy conference.
The Iraqi minister said that when cuts OPEC+ originally considered cuts in November “there were two alternatives of 1.6 and 1.8 million barrels per day”.
“But there was resistance by some members and that’s why we agreed on 1.2 million barrels per day,” he said.
Benchmark Brent oil prices have fallen to about $60 a barrel in recent weeks from their 2019 peaks of $75, as worries about a slowing global economy outweigh supply disruptions from sanctions-hit Iran and Venezuela.
Market players fear a US-Chinese trade war could push oil demand growth below 1% for the first time in years.
Russian Energy Minister Alexander Novak said he was concerned by the slowing global economy. He told reporters that slowing demand would be discussed at Thursday’s meeting but said there were no concrete proposals so far to adjust output.
Saudi Arabia’s new energy minister, Prince Abdulaziz bin Salman, downplayed such worries this week, saying demand would pick up once the trade threat dissipated.
On Iraqi output, Ghadhban said Iraq’s Kurdish region should respect its obligations regarding oil exports and its share in the federal budget.
The Kurdish Regional Government is supposed to give 250,000 barrels per day of oil to the federal government but is so far not complying, he said.
Ghadhban said Iraq aimed to explore for gas in its western desert, saying it had “huge potential”. He said Baghdad signed a contract with a Russian firm for a gas exploration block.
OPEC cuts oil demand forecast for 2020 on world economic outlookOPEC revised down its world oil demand growth projections to 1.08 million barrels per day (mb/d) for 2020, a 60,000 barrels per day (bpd) decrease ... Energy
OPEC secretary-general says no alternative plans for OPEC+ agreementOPEC Secretary-General Mohammad Barkindo said in a statement on Tuesday to Emirates news agency (WAM) that so far there are no alternative plans for ... Energy
No shift in Saudi OPEC policy after naming new energy minister: OfficialThere will be no shift in Saudi Arabia’s OPEC policy after the appointment of Prince Abdulaziz bin Salman as the new energy minister, and the ... Energy
OPEC posts first 2019 oil-output rise despite Saudi cuts, says surveyOPEC oil output has risen in August for the first month this year as higher supply from Iraq and Nigeria outweighed restraint by top exporter Saudi ... Energy