Dubai: Opec will meet non-Opec countries to finalise a global oil limiting pact on December 10 in the Russian capital Moscow, two Opec sources told Reuters yesterday.
Opec agreed last week to reduce output by around 1.2 million barrels per day (bpd) beginning in January in a bid to reduce global oversupply and prop up prices. It hopes non-Opec countries will contribute another 600,000 bpd to the cut. Russia has said it will reduce output by around 300,000 bpd.
Oil prices fell 1.5 percent to steady at around $53 a barrel yesterday after the biggest weekly rally since 2009 following Opec’s last week's decision to cut crude output. The market focus now shifts to the implementation and impact of Opec’s first production agreement since 2008, which will be joined by non-Opec producers, after data showed output in Russia rose in November to a post-Soviet high.
Front-month Brent crude futures were down 81 cents by 1153 GMT from their last settlement at $53.12 per barrel. The contract was up around 12 percent this week, its biggest gain since March 2009.
US West Texas Intermediate (WTI) futures were at $50.40, down 65 cents. Opec, which accounts for a third of global oil supply, will reduce production starting in January by 1.2 million barrels per day, or over 3 percent, to 32.5 million bpd.
“The lack of firm output commitments from some non-Opec producers may not be a major cause of concern, but the threat posed by non-compliance and the potential for US shale operators to spoil the party should not be ignored,” brokerage PVM Oil Associates said.
Russia said yesterday that its output in November rose slightly to 11.21 million bpd, a post-Soviet high. As part of the Opec deal, Russia has promised to gradually cut its crude output by up to 300,000 barrels per day in the first half of 2017.
