Iraq confident of OPEC deal to raise oil output

Roman Schwartz
June 23, 2018

"We were teased with an increase of about 1.8 million barrels (per day) at one point, and we ended up getting about 600,000", Kilduff said.

Saudi Oil Minister Khalid al-Falih said Friday that an OPEC committee ahead of the official meeting had agreed "to recommend releasing the equivalent of 1 million barrels or thereabout to the market".

Parviz Shahbazov, Azerbaijan's energy minister. He echoed earlier comments from OPEC Secretary-General Mohammad Barkindo. The cartel would be the biggest beneficiary of possible Chinese tariffs on USA oil imports, as these could help it regain market share, OPEC sources and industry officials tell Reuters.

Analysts expect the group will consider an increase of somewhere around 1 million barrels a day.

The countries of the OPEC oil cartel will discuss increasing their production by about 1 million barrels a day at a meeting Friday that could influence the cost of energy globally in coming months.

The increase will mostly come from Saudi Arabia and Russian Federation, with some extra volumes from UAE and Kuwait.

The group has been forced to take a softly-softly approach to oil production increases after cracks emerged within the cartel and threatened to dash the chances of a deal.

The only route to a production boost that Iran has publicly suggested - allowing the handful of countries that have voluntarily cut deeper than necessary to restore some output - would deliver far less extra oil to the market than the Saudi proposal.

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Global consumption has increased by an average of 1.7 million bpd for the last three years, accelerating from an average of 1.1 million bpd in the three previous years. Iran's output is also anticipated drop when Trump's sanctions come into effect later this year.

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Iran is particularly vocal about its objections as it braces for the impact of fresh United States sanctions on its oil exports after President Donald Trump quit the worldwide nuclear agreement. A big OPEC deal- adding more than 1 million barrels - could cause prices to dip into the $2.60s or $2.70s this summer, he said. In practice, the reduction was even deeper due to production problems. The measure has helped rebalance the market in the past 18 months and lifted oil to around $75 per barrel from as low as $27 in 2016.

USA shale oil production has helped offset some of OPEC's cutbacks since 2016. Zanganeh has said the president is to blame for high prices because of his unilateral withdrawal from the global nuclear agreement.

Mustapha Guitouni, Algeria's energy minister.

Iran and Saudi Arabia are known to be serious political foes in West Asia. Riyadh could also act unilaterally boosting output, as it did in 2011 after a meeting ended in acrimony without a deal.

With assistance from Annmarie Hordern, Manus Cranny, Nayla Razzouk, Salma El Wardany, Laura Hurst, Julian Lee, Elena Mazneva, Francois de Beaupuy and Golnar Motevalli.

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