KUWAIT (Reuters) - Kuwait’s oil minister said on Monday a pact between OPEC and non-OPEC producers to curb supplies would run to the end of the year and market conditions would determine whether to extend it beyond the end of 2018.
Bakhit al-Rashidi also said the meeting of the Organization of the Petroleum Exporting Countries in June in Vienna would offer a chance to review the deal, adding that oil markets were heading in the right direction for stability.
“The agreement will continue until end of this year,” the minister told reporters at an oil industry event in Kuwait.
He added that “it would depend on market conditions whether to extend this agreement beyond 2018 or to reach a permanent agreement between OPEC and non-OPEC to support market stability,” saying this issue would be reviewed later in the year.
An initial draft of a longer-term alliance between OPEC and non-OPEC oil producers would be discussed at the June meeting, OPEC Secretary-General Mohammad Barkindo said last week.
OPEC, Russia and several other non-OPEC producers began to cut supply in January 2017 in an effort to lift oil prices. The pact runs until the end of this year, and the June meeting will see participants decide their next course of action.
A surplus in global oil inventories was close to evaporating, OPEC said last week, citing healthy energy demand and its own supply cuts. It also revised up its forecast for output from rivals who have benefited from higher oil prices.
OPEC has a self-imposed goal of bringing oil inventories in industrialised countries down to their five-year average.
Barkindo said in Kuwait on Monday that oil stocks in the developed world fell in February to below 50 million barrels above the latest five-year average and that the declining trend would continue over the coming months.
Reporting by Rania El Gamal and Ahmed Haggagy; Editing by Maha El Dahan and Edmund Blair