Oil prices rose 1.5% on Monday, a day after Saudi Arabia's Energy Minister Khalid al-Falih said the kingdom would reduce oil exports by half a million barrels a day in December, Reuters reported. However, the US has granted waivers to certain major importers of Iranian crude, diminishing the expected cuts.
Saudi Arabia will cut production as well as exports, he said.
Khalid al-Falih's comments follow a meeting in Abu Dhabi at the weekend, where the Organisation of Petroleum Exporting Countries (OPEC) and its allies started laying the groundwork to cut supply in 2019, reversing an nearly year-long expansion.
Novak showed no sign he was ready to act immediately and Vagit Alekperov, the CEO of Russia's second-largest oil producer Lukoil PJSC, said there's no need to cut output now. "Sanctions didn't cut so much out of the market as anticipated", he added.
Abu Dhabi - Oil prices climbed on Monday as the world's biggest supplier Saudi Arabia announced plans to cut production.
"We're kind of back to square one: It must feel like November 2016 to them, a lot", said John Kilduff, a partner at Again Capital Management in NY, referring to the time period when OPEC and its allies agreed to initiate production cuts.
US West Texas Intermediate (WTI) crude futures were at $60.87 per barrel, up 68 cents, or 1.1 percent.
OPEC and non-OPEC energy ministers are due to meet in early December in Vienna to assess the global market. "The committee reviewed current oil supply and demand fundamentals and noted that 2019 prospects point to higher supply growth than global requirements", it said in a statement.
Mr Al Falih expressed concern, however, over the recent downward turn of the oil markets, which had through the summer held about $80 per barrel, only to fall to $69 on Friday, after the US Energy Information Administration reported higher US production figures and the White House granted waivers to eight of Iran's top oil buyers.
Major emerging economies like India, Indonesia and Turkey came under strong pressure earlier this year as their currencies slumped against the dollar just as oil prices surged, eroding demand.
"I think it all comes down to Russian Federation", said Helima Croft, chief commodities strategist at RBC Capital Market LLC. "The consensus is that we need to do whatever it takes to balance the market".
An official from group member Kuwait said on Monday major oil exporters had over the weekend "discussed a proposal for some kind of cut in (crude) supply next year", although the official did not provide any detail.
"Supply is about 100 million barrels a day and demand is about 100 million barrels a day ..."
Several analysts said oil prices were likely to turn bullish again.
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