OPEC experts’ meeting makes progress on output talks

November 22, 2016 10:26 am


Latest OPEC two-day meeting to nail down details of plan to cut oil output

Delegates optimistic that Nov 30 meeting will reach final agreement

Deal faces opposition from several countries who want to be exempt from cuts

 

OPEC experts have made some progress on the first day of a two-day meeting to nail down details of their plan to cut oil output, OPEC sources said on Monday, with some expressing optimism about the prospect of a final deal.

The second meeting of the High-Level Committee began at 0930 GMT. The committee is a technical body comprised mainly of OPEC governors and national representatives – officials who report to their respective ministers.

Delegates emerged after roughly eight hours of talks at OPEC’s Vienna headquarters, with some making upbeat comments to reporters. The meeting continues on at 0900 GMT on Tuesday.

 

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Meeting notes

“We are discussing. We are not disagreeing,” Libyan OPEC governor Mohamed Oun said and replied “yes” when asked whether the day had gone well.

Another OPEC delegate had earlier said there had been “some progress” and a third delegate said he was optimistic that the 14-nation group would reach a final agreement when its oil ministers meet in Vienna on November 30.

A fourth source said there were “some concerns” from Iran, but discussions were ongoing and was confident there would be a deal on November 30.

 

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Main concern

The key issue before the committee is how to share out the Organization of the Petroleum Exporting Countries’ September agreement to its first output cut since 2008, proposing to reduce production to between 32.5 million and 33m barrels per day to prop up prices.

Oun said that the committee had not yet settled on a list of individual output limits.

The deal faces potential setbacks from Iraq’s call for it to be exempt and from countries — including Iran, Libya and Nigeria — that have had output hit by sanctions or conflict and want to increase supply. (More on Iraq’s suggestions to facilitate OPEC supply cut agreement here)

A first meeting of the High-Level Committee, held in October, failed to reach agreement. One issue at the talks was the level at which Iran would be expected to freeze its output, sources told Reuters.

But in recent days, ministers and officials have said that OPEC was moving closer towards dealing with sticking points and most members were prepared to offer Iran flexibility on production volumes.

The committee does not decide policy and will instead make recommendations to the OPEC ministerial meeting on Nov. 30.

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Reuters
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