News ID: 176232
Published: 0721 GMT January 22, 2017

Oil producers laud strong start to output cuts

Oil producers laud strong start to output cuts

OPEC and non-OPEC countries have made a strong start to lowering their oil output under the first such pact in more than a decade, energy ministers said on Sunday as producers look to reduce oversupply and support prices.

"The deal is a success ...All the countries are sticking to the deal ...(the) results are above expectations," Russian Energy Minister Alexander Novak said after the first meeting of a committee set up to monitor the deal, Reuters reported.

Ministers said 1.5 million of almost 1.8 million barrels per day (mbd) had been taken out of the market already.

Countries involved in the deal could reduce their output by 1.7 mbd by the end of the month, Novak said.

Eleven of OPEC's 13 members along with 11 non-OPEC countries have agreed to make cuts for the first half of the year.

"The kingdom has taken the initiative and other countries took part in very significant actions," Saudi Energy Minister Khalid al-Falih told reporters following the meeting.

Brent oil prices that fell to $27.10 a barrel a year ago have held above $50 per barrel since OPEC producers agreed on Dec. 10 to lower output in the first half of 2017.

The cuts are aimed at reducing a global glut in oil that has weighed on oil prices for more than two years.

Falih said implementation of agreed cuts had been "fantastic" and he hoped for 100 percent compliance in February.

The other members of the committee represent Algeria, Venezuela, Russia and Oman.

On Sunday it was agreed that a technical joint committee (JTC) would be created comprising a representative for each of the five members of the monitoring committee and as well as the OPEC presidency, which is currently held by Saudi Arabia.

The JTC will cooperate with the OPEC Secretariat in compiling production data which will be presented to the ministerial monitoring committee by the 17th of every month, OPEC said in a news release.

The monitoring committee will communicate after the 17th of every month and plans two meetings ahead of the next ordinary OPEC meeting in Vienna on May 25.

The next meeting in March is set for Kuwait.




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