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Live: Oil higher as Iran and Iraq back a 9-month extension to output cap

 

Live: Oil higher as Iran and Iraq back a 9-month extension to output cap
 
Our live blog is tracking market reaction as oil ministers meet in Vienna.
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Our live blog is tracking market reaction as oil ministers meet in Vienna.

We'll bring you the latest analysis below.

http://www.cnbc.com/2017/05/25/oil-output-cap-opec-supply-fed-minutes-deutsche.html?__source=synacor&par=synacor

 

(OK, they're not showing more info "below", but this does appear to be news! / Dinar4Dinner)

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It's not what we were looking for... To quote Adams' earlier message;

 

And what we are hoping for, fingers crossed, is that Iraq is quietly granted 
an exemption to the oil output deal for a limited time.

 

No suggestion they have been granted an exemption from the output. They are joining with the cut agreement of 9 months.

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35 minutes ago, captl1 said:

Good morning Yota and DV. I believe the definitive word was quietly. Second every OPEC country cheats on its allocation. IMO this IS just what we are looking for.

 

Good point and I hope that you are right, captl1!

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History of edits:: 2017/5/25 14:10 • 14 times readable
High oil prices ahead of OPEC meeting
{Baghdad: Euphrates News} Oil prices rose ahead of a meeting of OPEC, on Thursday, is expected to result in the extension of production cuts beyond 2017 to increase at least nine months after the initial six months in the first half of this year.
At 0539 GMT , futures recorded Brent crude to $ 54.41 a barrel , 45 cents higher, equivalent to 0.8 percent from its previous close. 
The futures increased US crude WTI 40 cents , or 0.8 percent , to $ 51.76. 
Both high already allocated more than 16 percent from the lows for the month of May. 
Prices rose by consensus that the Organization of Petroleum Exporting Countries pledged Petroleum {OPEC} and other producers , including Russia , to cut supplies 1.8 million barrels per day will be decided to extend beyond 2017 , rather than simply covering the first half of the year. 
Geoffrey Haley , an analyst at brokerage in Luanda Futures in Singapore, said that there is speculation that the cuts may increase for nine months and perhaps 12 Shahra.anthy
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14244.jpg
   
Economy News _ Baghdad:
 
 
 
 
Iraqi Oil Minister Ali Jabbar Luaibi said on Thursday that the extension of the reduction of the current supply led OPEC to nine months is the perfect choice to restore the balance of crude market.
 
The minister added that there is another proposal to extend the nine-month agreement with the deepening of the cuts.
 
Bracing OPEC oil producers and non-members to extend production cuts today may be for up to 12 months to assist in the discharge glut of global stocks and raise crude prices.
 
Organization of the Petroleum Exporting Countries in Vienna, looking to extend the agreement, which was concluded in December with 11 countries outside the cut in oil production of about 1.8 million barrels per day in the first half of 2017.
 
Most OPEC ministers expect their delegates and the market for an extension of nine months - instead of the proposed six months initially - as a concept essential but some countries such as Russia hinted to a longer extension of up to 12 months.
 
The OPEC delegate said, "I think probably nine months." The opinion agreed with him four other delegates.
 
Saudi Arabia was the largest producer in OPEC and Russia, the largest producer outside the organization saying that it was necessary to extend the cuts to speed up the re-balance to the market and prevent oil prices fell again from $ 50 a barrel.
 
According to sources in OPEC's meeting on Thursday it will highlight the need for long-term cooperation with non-member producers.
 
The organization has sent a message to the market that it would seek to curb oil exports, which did not decline as much as its decline in production.
 
But sources ruled out a decision to deepen production cuts on Thursday. It is expected that the organization will hold its meeting on Thursday, following a joint meeting with non-member States after 1320 GMT.
 
By 0804 GMT, Brent crude was up about one percent at around $ 54.50 a barrel.
 
OPEC had cut helped push oil above $ 50 a barrel this year, which gave a financial boost to the producers who depend a lot of them rely too heavily on energy revenues and were forced to withdraw from foreign exchange reserves to fill the gaps in their budgets.
 
The forced oil fell earlier, which began in 2014, Russia and Saudi Arabia on austerity and led to unrest in some producing countries such as Venezuela and Nigeria.
 
 
 
Views 160   Date Added 25/05/2017 - 12:25   Last updated 25/05/2017 - 14:22   No. Content 7622
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I mentioned in VIP yesterday that a 9 month extension was going on the table.

 

I've actually learned this morning that a 12 month deal is being discussed as well, but I think that's just negotiation and they will setting in the middle (9 months).

 

:twocents: 

 

Also, I found this while scouring the net this morning at 4AM or so:

 

DApr47jXoAEef17.jpg

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Delegate: OPEC agrees to extend oil production cuts for nine months

5/25/2017 2:22:00 AM 32 Number of readings
 

112552017_opec.jpg

 

 

 

Khandan - The news agency 'Reuters' for delegate to OPEC, the Organization decided on Thursday to extend oil production cuts nine months to March 2018 at a time when the organization is facing a global glut in crude supply after seeing lower prices halved and declining revenues fell sharply in the last three years. 

It is likely to be involved about a dozen non - member countries , led by Russia , the largest oil producer in the world in the cuts as it did in conjunction with the Organization of the Petroleum Exporting Countries since the beginning of January. 

The OPEC cuts helped oil back above $ 50 a barrel this year , which gave a financial boost to the producers who depend a lot of them rely too heavily on energy revenues have been forced to withdraw from foreign exchange reserves to fill gaps in their budgets. 

And it forced the decline in the price of oil , which began in 2014 Russia and Saudi Arabia on austerity and led to unrest in some producing countries such as Venezuela and Nigeria. 

But higher prices this year encouraged to increase the production of oil shale in the United States is involved in the production agreement , which curb the restoration of equilibrium in the market for global crude inventories remain near record highs.

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1 hour ago, danielchu said:

well i guess no HCL for us?

 

Oil and gas law leaves to the next session of Parliament and the Government

قانون النفط والغاز يُرحّل الى الدورة المقبلة للحكومة والبرلمان
 
 Twilight news    
 
 
 

 

Twilight news/member of oil and Energy Committee in the Iraqi Parliament Ares Abdullah on Thursday continuing differences between the Kurdistan Regional Government and the Federal Government on the draft oil and gas law, excluding its passage any time soon.

Abdullah said at a press conference in Arbil, capital of Kurdistan region today, that a lawmaker that the Iraqi Cabinet still law holds it in degrees and not reached any solution to pass, sending it to the House of representatives, asserting that the Iraqi Constitution grants a right to Kurdistan to dispose of oil extracted from its regions.

He explained that because of the controversy over the Bill due to a broader field of powers clause of the oil sector to the provinces, Kurdistan,

expressed regret for the inaction of Erbil and Baghdad to reach a solution to pass that law.

 

 

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Opening address to the 172nd Meeting of the OPEC Conference

No 21/2017
Vienna, Austria
25 May 2017

by HE Khalid A. Al-Falih, Saudi Arabia's Minister of Energy, Industry and Mineral Resources, and President of the OPEC Conference


Your Excellencies, Distinguished Delegates, Ladies and Gentlemen: Good morning.  It is my pleasure to welcome you all to the OPEC Secretariat for the 172nd Meeting of the OPEC Conference.  I would especially like to recognize and welcome several esteemed gentlemen who join us here for the first time.

I first would like to welcome and congratulate His Excellency Issam A. Almarzooq, who was appointed Kuwait’s Minister of Oil, and Minister of Electricity and Water last year.

Second, I would like to similarly welcome and congratulate His Excellency Dr. Nelson Martínez, who was appointed People’s Minister of Petroleum of the Bolivarian Republic of Venezuela early in 2017.

Third, I would also like to welcome and congratulate His Excellency Pascal Houangni Ambouroue, who was appointed Minister of Petroleum and Hydrocarbons of Gabon, also earlier this year.

And finally, I would like to welcome and congratulate His Excellency Carlos E. Pérez, Ecuador’s Minister of Hydrocarbons, who was appointed earlier this month.

Our gratitude and sincere thanks go to their predecessors, who contributed greatly to our past successes.

I would also like to recognize His Excellency Gabriel Mbaga Obiang Lima, Minister of Mines and Hydrocarbons of the Republic of Equatorial Guinea, and welcome his nation, which has joined the Organization as a Member Country.

On behalf of everyone here, Your Excellencies, we look forward to working together with each one of you and your national delegations.

Ladies and Gentlemen,

Since our last meeting in November, the oil market situation has markedly improved.  We started with a bearish sentiment, but the market is now well on its way toward rebalancing.  We have more work to do in lowering inventories toward the last five-year average, but we are on the right track.

Stakeholders across the spectrum are benefitting from the improved situation—not only the producers who are part of the supply agreement but other countries as well.  IOCs are also posting their best quarterly earnings in two years.  Investment flows into the upstream sector have picked up, albeit at a slower pace than required to meet forecast long-term demand.  And despite potential volatility, I expect the situation to continue improving, assisted by a more robust global economy and higher GDP growth in 2017, as well as fairly healthy oil demand growth this year, particularly in Asia.

The market has seen OPEC’s firm and unwavering resolve, along with that of the participating non-OPEC producing countries, as reflected in the high level of conformity—with reductions exceeding 100 percent of the target in first four months of the agreement.  The Joint Ministerial Monitoring Committee and the Joint Technical Committee were created to effectively implement the accords, and both have helped deliver concrete results, leading to the return of confidence and positive market sentiment I referred to earlier.  I would like to recognize their contributions.

But these outcomes could not have been achieved without the extensive process of consultations and discussions involving all of the OPEC Member Countries and the participating non-OPEC producing countries.  So, I would like to compliment and congratulate all of my colleagues for this accomplishment, and for the high level of conformity exhibited by the majority of Member Countries, without which the market would still be adrift.

Nevertheless, vigilance should be the watchword of the day, and it is critical that we do not become complacent.

Your Excellencies, ladies and gentlemen,

At today’s meeting, we will review the developments of the past six months, as well as the market outlook for the remainder of 2017 and beyond, as we consider our posture going forward.

The main focus for today remains on consolidating, strengthening and accelerating the process of rebalancing, alongside the important task of drawing down global oil inventories.

Together with our partners among participating non-OPEC countries, we will continue to monitor the health of the oil market and the wider global economy, and examine ways to accelerate recovery and return the market to its normal condition.

Your Excellencies, ladies and gentlemen,

Beyond the important task of rebalancing markets in the short to mid-term, I would also like to reiterate the vision for a forward-looking OPEC of the future that I outlined after assuming OPEC’s Presidency early in the year.

Nurturing a constructive and stable market environment is our highest priority.  This goal is important not only for us but also for consumers, as it ensures a sustainable future for oil supply and demand—the absence of which may produce seriously unwelcome outcomes such as price spikes and risks to global energy security.  Other key objectives include strengthening cooperation between OPEC and non-OPEC producers, and fostering excellent relations with international energy institutions to promote greater understanding of vital issues.

OPEC also has a fundamental interest in the health of the global economy and the worldwide energy industry, so that appropriate levels of investment are maintained and technological progress continues to be encouraged and nurtured.  OPEC will therefore be strengthened to proactively deal with emerging challenges, and the institution will further evolve as a highly respected organization able to deal with growing complexity and accelerating change.

Lastly, we will give special attention to lightening the environmental footprint of oil, making a positive and compelling case for our natural resources.  We will therefore engage appropriately with the United Nations Framework Convention on Climate Change, or UNFCCC.

Your Excellencies, ladies and gentlemen,

As we begin today’s Meeting of the Conference, the task in front of us is admittedly challenging and complex, but I’m confident that by working together we can and will accomplish our goals for the mutual benefit of all.  Thank you for your attention.

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OPEC to Extend Oil Cuts for Nine Months to End Global Glut

by 
Grant Smith
, 
Angelina Rascouet
, and 
Wael Mahdi
May 25, 2017, 6:11 AM EDT May 25, 2017, 6:55 AM EDT
  • Keeping curbs through March will ‘do the trick,’ Al-Falih says
  • Brent crude falls on lack of additional action from group
 
 
 
0:120:15
 
 
OPEC Said to Extend Oil Production Cuts for Nine Months
 
 
 
 

OPEC Said to Extend Oil Production Cuts for Nine Months

OPEC extended oil production cuts for nine more months after last year’s landmark agreement failed to eliminate the global oversupply or achieve a sustained price recovery.

Members of the organization agreed to prolong their accord through March, said two delegates familiar with the decision, asking not to be identified before an official announcement is made. Ministers are scheduled to discuss the extension with non-member producers later on Thursday.

Six months after forming an unprecedented coalition of 24 nations and delivering output reductions that exceeded expectations, resurgent production from U.S. shale fields has meant oil inventories remain well above targeted levels. While supplies are shrinking, ministers acknowledged that the surplus built up during three years of overproduction won’t clear until at least the end of 2017.

800x-1.jpg

Khalid Al-Falih at the OPEC meeting on May 25.

Photographer: Akos Stiller/Bloomberg

Maintaining the same production cuts through March “is a very safe and almost certain option to do the trick,” Saudi Oil Minister Khalid Al-Falih said at the opening session of the group’s meeting in Vienna. “It’s likely we’ll be balanced earlier than later.”

The Organization of Petroleum Exporting Countries agreed in November to cut output by about 1.2 million barrels a day. Eleven non-members including Russia joined the deal in December, bringing the total supply reduction to about 1.8 million. The curbs were intended to last six months from January, but confidence in the deal, which boosted prices as much as 20 percent, waned as inventories remained stubbornly high and U.S. output surged.

Cuts Working

Al-Falih insisted the cuts are working, saying stockpile reductions will accelerate in the third quarter and inventory levels will come down to the five-year average in the first quarter of next year. While he expects a “healthy return” for U.S. shale, that won’t derail OPEC’s goals, he said.

Libya and Nigeria will remain exempt from the output curbs as they restore lost production, according to Al-Falih. Nigerian Oil Minister Emmanuel Kachikwu said earlier in an interview that extending the deal would bring price stability, suggesting a “$50 floor” for oil if producers stick to their cuts.

 
 
Kachikwu: Members 'Largely' on Board With Extension
 
Kachikwu talks to Bloomberg TV. (Scroll to 2:20 for his comments on oil prices.)
Source: Bloomberg

Benchmark Brent crude traded at $53.08 a barrel as of 11:54 a.m. in London, down 1.6 percent. Some investors are disappointed after speculating OPEC might announce some additional action, said Giovanni Staunovo, an analyst at UBS Group AG.

The oil market is also looking for clues as to what OPEC may do in 2018, a year when U.S. shale output growth is expected to match an increase in demand. There’s concern that OPEC could return to the free-for-all production that caused prices to slump from 2014 to 2016, though Al-Falih has insisted the organization will maintain control.

“We have said we will do whatever it takes,” the minister said.

Edited by Theseus
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Kurdistan oil exports not subject to OPEC reduction agreement

By Rudaw 22 minutes ago
Iraq’s oil minister Jabbar al-Luaibi, speaking at OPEC’s meeting in Vienna. Photo: Rudaw video
Iraq’s oil minister Jabbar al-Luaibi, speaking at OPEC’s meeting in Vienna. 
 
VIENNA, Austria – Kurdistan Region oil exports are not subject to OPEC’s renewed reduction targets, Iraq’s oil minister stated, adding, however, that he hopes they will be included. He said he will visit the Region to discuss the matter with the Kurdistan government, with whom, he said, Baghdad has good relations. 
 
“Our relations with the Kurdistan Region are very good. We have coordination with each other. There might be misunderstanding and lack of clarity with respect to some issues. Nevertheless, we continued relations, but we should be more accurate,” Minister Jabbar al-Luaibi told Rudaw Thursday in Vienna while participating in the OPEC meeting.

On Wednesday, OPEC member states announced that they have agreed to cut oil outputs for another nine months as they attempt to bolster the oil market.

“The reduction doesn’t include the Kurdistan Region,” Luaibi said. “But we will be trying to include the Kurdistan Region in the reduction of its oil. I have plans to visit the Kurdistan Region and discuss this with them after my return to Iraq.”

OPEC members and non-members first reduced production after reaching an agreement in November 2016 to cut productions by 1,200,000 barrels per day for six months. Iraq’s share in this collective reduction in oil production was 210,000 barrels of oil daily. 

Also attending the OPEC meeting, Iran’s oil minister, Bijan Zanganeh, said his country is signing contracts with European and Asian oil companies, but not American companies who are limited by the US administration. 

Pointing to the country’s recent high election turnout and public desire for greater international ties, Zanganeh said, “it’s the time, I think, for the US administration to change their position against the Iranian nation.”


Iran’s oil minister Bijan Zanganeh speaking in Vienna.
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