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On Sunday, Saudi Arabia’s energy minister urged global oil producers to extend their cooperation beyond 2018. Speaking to reporters ahead of an OPEC joint ministerial committee, Khalid al-Falih also raised the prospect of a new form of agreement rather than continuing with the same level of production cuts.
It was the first time OPEC kingpin Saudi Arabia had publicly suggested a new form of coordination among oil producers after 2018.
The current deal, struck by OPEC and 10 other allied producers, is scheduled to last throughout the calendar year. It is thought to have supported the recent oil price rally and helped to clear a global supply overhang.
Robust demand in China, India and the U.S. — as well as the ongoing production cuts from OPEC and its allied producers — could help to rebalance the oil market this year, the chief executive of Italian oil and gas giant Eni told CNBC.
“For the first time, the fundamentals are leading the price scenario … (So) I think it can happen,” Claudio Descalzi, CEO of Eni, said while speaking at Davos on Tuesday.
Brent crude traded at $69.41 a barrel at around 12:40 p.m. London time, up 0.54 percent, while U.S. crude was seen at $63.89, up 0.5 percent.
The price of oil collapsed from near $120 a barrel in June 2014 due to weak demand, a strong dollar and booming U.S. shale production. OPEC’s reluctance to cut output was also seen as a key reason behind the fall. But, the oil cartel soon moved to curb production — along with other oil producing nations — in late 2016.
There's an acceptance that the OPEC deal should extend beyond 2018, Saudi energy minister says