Oil prices have recovered after Saudi Arabia pledged to reduce exports beginning next month, following the meeting in Russia between OPEC and other producers.
Brent crude for September delivery climbed 22 cents to $48.82 a barrel, while the US West Texas Intermediate (WTI) futures gained 23 cents and traded at $46.57, reported Reuters.
The Joint OPEC-Non-OPEC Ministerial Monitoring Committee (JMMC) met in St Petersburg for its fourth meeting. It reviewed the Joint OPEC-Non-OPEC Technical Committee (JTC) report and noted that the oil market is making steady progress towards rebalancing.
Oil prices also gained support from Halliburton's executive chairman opinion that the rising rig count in North America is indicating ‘signs of plateauing’.
During the meeting, OPEC and non-member producers discussed that the oil production curb deal that pledges to reduce output by 1.8 million barrels per day (bpd) may be extended beyond March next year if necessary.
Saudi Arabia Minister of Energy Khalid al-Falih stated that the country would restrict its exports to 6.6 million bpd next month, nearly one million bpd lower than the previous year’s levels.
Nigeria expressed its interest to join the deal by capping or cutting its output from 1.8 million bpd once it has stabilised at this level. Despite being an OPEC member, the country is currently exempt from the agreement.
OPEC also reported that inventories of industrial nations declined by 90 million barrels over the period January to June this year. However, stocks are still at 250 million barrels above the five-year average.
Russian Minister of Energy Alexander Novak opined that if compliance levels among the participating countries to the oil curb deal touch 100%, an additional 200,000bpd will be removed from the global market.
Meanwhile, a Sinopec Group executive told the news agency that China’s crude imports are expected to cross 400 million tonnes this year.