Iraq agrees to nine-month extension of OPEC production cut

May 23, 2017 | 10:00

(0) user say

BAGHDAD: Iraq has agreed to a nine-month extension of a production cut pact among OPEC members that is aimed at boosting crude prices, the country's oil minister said on Monday (May 22).

An oil field. (AFP/Haidar Mohammed Ali)

"We are in agreement with the kingdom (of Saudi Arabia) ... to continue the production cut" for another nine months, Jabbar al-Luaybi told a news conference in Baghdad alongside the Saudi energy minister, Khalid al-Falih.

"After our conversation with the prime minister, he gave the green light to his excellency (the Iraqi oil minister) to approve" the nine-month extension, Falih said.

At the end of November, the 13 members of the Organisation of Petroleum Exporting Countries (OPEC) agreed to cut output by 1.2 million barrels per day from Jan 1, initially for a period of six months, to reduce a supply glut.

Then in December, non-OPEC producers led by Russia agreed to reduce their own output by 558,000 barrels per day.

OPEC members and Russia will meet on Thursday and are expected to extend the production cut agreement.

"After the historic agreement last November which restored balance to the markets, the oil industry began to recover in a major way, but not completely," Falih said.

Iraq, which relies on revenue from crude sales for the vast majority of government funds, was hit hard by the fall in oil prices, which came as it wages a costly war against the militants.

AFP

What the stars mean:

★ Poor ★ ★ Promising ★★★ Good ★★★★ Very good ★★★★★ Exceptional