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Iraq to follow OPEC consensus on production cuts

Iraq to follow OPEC consensus on production cuts

Apr 27, 2017
3 min read
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Iraq will follow consensus reached by OPEC when the oil exporter group meets in Vienna next month to discuss extending production cuts, the country's oil minister said.

"Now we're going on the 25th of May to OPEC and we're definitely going to be in line with OPEC's final decision and collective decisions," Reuters quoted Jabar al-Luaibi as having said at a Paris conference.

Iraq, the second-largest producer in the Organization of the Petroleum Exporting Countries, was in full compliance with the OPEC-led supply pact reached last year and has achieved about 97 percent of its output reduction target, Luaibi said.

"Iraq is fully committed and Iraq is in full compliance with OPEC members," Luaibi said, adding the OPEC-led cuts were gradually leading to a long-awaited rebalancing of the oil market.

OPEC, Russia and other producers originally agreed to cut production by 1.8 million barrels per day (bpd) for six months from Jan. 1 to support the market and to bring a supply glut into check.

The producers are expected to prolong the pact for a further six months when they meet in May, but Saudi Energy Minister Khalid Al Falih last week in Abu Dhabi said the deal may not be extended for another six months but might require another three months.

Luaibi said the OPEC decision to cut did not mean countries should stop developing their oil industries. Earlier this month, Luaibi said Iraq planned to raise its oil output capacity to 5 million bpd before the end of the year.

Elsewhere, the energy ministers of OPEC members Saudi Arabia and Venezuela plan to meet their Russian counterpart to discuss extending oil-output cuts, Bloomberg reported.

Saudi Minister of Energy and Industry Khalid Al-Falih said in Baku that he will talk with Russia’s Alexander Novak by phone this week and meet him within the next two weeks. Venezuela’s Oil Minister Nelson Martinez was also planning to visit Moscow after talks in Algeria on Wednesday, said a person familiar with the matter.

OPEC last week said its members and non-members part of the production cut agreement showed improved conformity in March, up from February’s 94 per cent. 

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