OPEC Likely to Extend Oil Output Cut Deal With Current Terms for 9 Months

The Organization of the Petroleum Exporting Countries (OPEC) is highly likely to extend the oil production cuts deal with the same terms for nine months, Minister of Energy, Industry and Mineral Resources of Saudi Arabia Khalid Falih said Thursday.

VIENNA (Sputnik) — On Wednesday, the Iranian oil minister said that all members of the Organization of the Petroleum Exporting Countries (OPEC) appear to be supporting the extension of the oil production curtailment agreement, but the timeframe remains the topic for discussion.

"It is highly likely that the decision is made that we are going to roll over with the same terms on a nine month period," Falih told reporters.

The future of the Vienna agreement on oil production cuts will be decided in late November, should it be extended for nine more months.

No exit strategy from the oil production reduction deal has been developed, he said.

"We have not developed a strategy, but in unforeseen circumstances of mass disruptions somewhere, of course OPEC is very fragile we will do what is necessary to ensure the global market has supply but we don't plan for any circumstances," he told reporters.

In late November, OPEC member states signed an agreement to decrease oil production by 1.2 million barrels per day to 32.5 million barrels per day for the whole cartel. In December, 11 non-OPEC countries decided to jointly cut oil output by 558,000 barrels per day, with Russia agreeing to cut its output by 300,000 barrels per day for six months from January 2017.

The OPEC and non-cartel ministers are currently considering considering an extension of the deal by various periods of time, including until the end of 2018. However, the 9-month extension remains the main option, according to Boutarfa.

At the moment, OPEC's implementation of the oil production curtailment stands at over 100 percent, while non-cartel countries have reached an adherence of over 95 percent, according to Algerian Energy Minister Noureddine Boutarfa.