Saudi Arabia's energy minister made his clearest statement yet that he expects the OPEC led production cuts will be extended into second half of the year, and possibly into next year as well.
In a speech at an energy event in Kuala Lumpur, Khalid al-Falih, made it clear that he hopes that the deal to limit production cuts will be extended towards the end of the year and possibly further.
“Based on consultations that I’ve had with participating members, I am confident the agreement will be extended into the second half of the year and possibly beyond. The producer coalition is determined to do whatever it takes to achieve our target of bringing stock levels back to the five-year average,” said Falih at the event in Kuala Lumpur.
The comments made by the Saudi energy minister was followed by a statement Russian energy minister, Alexander Novak, who said he supported continuing the cuts, arguing stronger oil demand would make them more effective in the coming months.
“We are discussing a number of scenarios and believe extension for a longer period will help speed up market rebalancing,” Novak said in a statement.
Both these comments came after last week's dramatic sell-off that led to oil prices falling to their lowest levels in six months.