Saudi calls on OPEC+ to be flexible as it weighs oil cut extension

By Rania El Gamal, Alex Lawler and Ahmad Ghaddar DUBAI/MOSCOW/LONDON (Reuters) - 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.

Reuters November 18, 2020 00:06:24 IST
Saudi calls on OPEC+ to be flexible as it weighs oil cut extension

Saudi calls on OPEC to be flexible as it weighs oil cut extension

By Rania El Gamal, Alex Lawler and Ahmad Ghaddar

DUBAI/MOSCOW/LONDON (Reuters) - 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.

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% of global demand, in January to support the market.

"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 a virtual meeting of an OPEC+ panel, the Joint Ministerial Monitoring Committee (JMMC).

The JMMC, which can recommend policy to the broader group, made no formal recommendations on Tuesday, three OPEC+ sources said.

Saudi Arabia, the world's biggest oil exporter, has indicated it wants a tighter policy in 2021 to draw down inventories still bulging since demand tumbled this year.

But other big producers, such as Iraq, have failed to deliver fully on promised cuts and have signalled they want some leeway to produce more oil next year.

"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," the Saudi minister said.

OPEC+, which holds a full ministerial meeting on Nov. 30 and Dec. 1 to discuss policy, agreed record oil cuts earlier this year as global lockdown measures aimed at preventing the virus from spreading drove down fuel demand.

Russian Deputy Prime Minister Alexander Novak said Russia would stick to its obligations under the OPEC+ deal and said the market had reached stability thanks to joint efforts. He did not say if Moscow was ready to extend existing cuts.

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

Oil slipped further below $44 a barrel on Tuesday, although hopes for a COVID-19 vaccine and expectations of further action by OPEC+ are lending support. [O/R]

(Reporting by Rania El Gamal, Alex Lawler, Ahmad Ghaddar, Vladimir Soldatkin and Olesya Astakhova; Editing by Jason Neely and Edmund Blair)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

France, Germany to agree to NATO role against Islamic State - sources
| Reuters
World

France, Germany to agree to NATO role against Islamic State - sources | Reuters

By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States

China's Xi says navy should become world class
| Reuters
World

China's Xi says navy should become world class | Reuters

BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.