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Abu Dhabi, UAEMonday 18 June 2018

Saudi, Iraq oil ministers agree to stronger oil-cut commitment 

Ministers Al-Falih and al-Luaibi agree to ensure co-ordination of oil policies 

Transformation in the GCC economies means moving away from a dependence on oil revenues and allowing different sectors to be developed. Spencer Platt / AFP / Getty Images
Transformation in the GCC economies means moving away from a dependence on oil revenues and allowing different sectors to be developed. Spencer Platt / AFP / Getty Images

OPEC’s two biggest producers agreed to strengthen their commitment to production cuts and maintain balance in world crude markets, Saudi Energy Minister Khalid Al-Falih said after talks with his Iraqi counterpart Jabbar al-Luaibi, according to the kingdom’s state news agency SPA.

The two ministers also agreed to ensure coordination of their nations’ oil policies, Saudi Press Agency reported Thursday, citing comments by Al-Falih after their meeting in the Red Sea city of Jeddah.

Saudi Arabia, the largest member of the Organization of Petroleum Exporting Countries, has borne the brunt of output cuts aimed at ending a global oversupply weighing on prices. Compliance by Iraq, OPEC’s second-biggest producer, slumped to 29 percent in June, its lowest since the output limits took effect in January, according to data from the International Energy Agency. OPEC and allied suppliers agreed to extend their cuts through next March.

Al-Falih’s remarks came a day after OPEC said that Iraq, the United Arab Emirates and Kazakhstan -- which have all lagged in making the output reductions they promised -- affirmed that they would adhere to the cuts accord. That meeting, in Abu Dhabi, was led by Kuwait and Russia and was scheduled after several oil-supplying nations faltered in their pledges to curb output.

Saudi Crown Prince Mohammed bin Salman also met with Iraq’s al-Luaibi in Jeddah and discussed coordinating oil policies and the two countries’ commitment to their pledged cuts until global markets come into balance, SPA reported earlier.

*Bloomberg