Thursday, May 25, 2017

OPEC extends oil output cut by nine months: delegate



OPEC extends oil output cut by nine months: delegate


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OPEC President, Saudi Arabia's Energy Minister Khalid al-Falih, and OPEC Secretary General Mohammad Barkindo talk to journalists before the beginning of a meeting of the Organization of the Petroleum Exporting Countries (OPEC) in Vienna, Austria, May 25, 2017. REUTERS/Leonhard Foeger
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OPEC decided on Thursday to extend cuts in oil output by nine months to March 2018, an OPEC delegate said, as the producer group battles a global glut of crude after seeing prices halve and revenues drop sharply in the past three years.

The cuts are likely to be shared again by a dozen non-members led by top oil producer Russia, which reduced output in tandem with the Organization of the Petroleum Exporting Countries from January. Non-OPEC producers meet OPEC later on Thursday.
OPEC's cuts have helped push oil back above $50 a barrel this year, giving a fiscal boost to producers, many of which rely heavily on energy revenues and have had to burn through foreign-currency reserves to plug holes in their budgets.
Oil's earlier price decline, which started in 2014, forced Russia and Saudi Arabia to tighten their belts and led to unrest in some producing countries including Venezuela and Nigeria.
The price rise this year has spurred growth in the U.S. shale industry, which is not participating in the output deal, thus slowing the market's rebalancing with global crude stocks still near record highs.
(Reporting by Alex Lawler; Writing by Dmitry Zhdannikov; Editing by Dale Hudson)

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