Saudi Arabia and Russia will discuss raising OPEC and non-OPEC oil output by around 1 million barrels per day (bpd), easing 17 months of strict supply curbs, sources familiar with the matter said. An increase of about 1 million bpd would bring compliance with global supply curbs down to 100 percent from around 152 percent, the sources said.
The initial talks are being led by the energy ministers of Saudi Arabia and Russia at St. Petersburg this week along with their counterpart from the United Arab Emirates (UAE), which holds the OPEC presidency this year, the sources said. OPEC and non-OPEC ministers meet next in Vienna on June 22-23, and the final decision will be taken there.
Discussions are still ongoing aimed at relaxing record high compliance with the production cuts which reached 152 percent in April, to just 100 percent, the sources said, in a bid to cool the market after oil prices rose to $80 a barrel on supply shortage concerns. The final production number that needs to be added is not set yet as dividing up the extra barrels can be tricky, the sources said.
“The talks now are to bring compliance down to 100 percent level, more for OPEC rather than for non-OPEC,” one source said. OPEC may decide to raise oil output as soon as June due to worries over Iranian and Venezuelan supply and after Washington raised concerns the oil rally was going too far, OPEC and oil industry sources told Reuters on Tuesday.