Saudi Arabia urges OPEC+ to be flexible as it weighs oil cut extension

“We as a group do not want to give the markets any excuse to react negatively,” Saudi Energy Minister Prince Abdulaziz bin Salman said. (File photo)

Saudi Arabia called on fellow OPEC+ members on Tuesday to be flexible in responding to oil market needs as it builds the case for a tighter oil production policy in 2021 to tackle weaker demand amid a new wave of the coronavirus pandemic.

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OPEC+, which groups the Organization of the Petroleum Exporting Countries, Russia and others, is considering delaying a plan to boost output by 2 million barrels per day (bpd), or 2 percent of global demand, in January to support the market.

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“We as a group do not want to give the markets any excuse to react negatively,” Saudi Energy Minister Prince Abdulaziz bin Salman said at the start of a virtual meeting of an OPEC+ panel, the Joint Ministerial Monitoring Committee (JMMC).

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“The markets will not be kind to those who do not stick to agreements. This is why we must be prepared to act according to the requirements of the market. I recently said we must be ready to tweak the terms of our agreement if need be,” he said.

The JMMC can recommend policy steps to OPEC+, which agreed record oil cuts earlier this year.

An option gaining support among OPEC+ nations is to keep the existing output cuts of 7.7 million bpd for a further three to six months, OPEC+ sources said, rather than tapering the cut to 5.7 million bpd in January.

OPEC+ will have a full meeting on November 30 and December 1 to decide output policy for next year.

Oil slipped further below $44 a barrel on Tuesday, although it has found support from hopes for a COVID-19 vaccine and amid expectations in recent days of further action by OPEC+.

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Last Update: Tuesday, 17 November 2020 KSA 19:00 - GMT 16:00
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