Opec ECB says glut persists, monitoring needed

Opec's Economic Commission Board (ECB) met this week and concluded that crude markets require further monitoring to evaluate the effectiveness of the group's production cut deal.

The ECB agreed that the supply "glut is still there," a participant at the meeting told Argus.

The agreement between Opec and 10 non-Opec countries — collectively known as Opec+ — aims to curb collective output by a combined 1.2mn b/d. It expires on 31 March.

Early indications suggest that Opec+ may extend the deal beyond March when they meet next week in Vienna. Oman's oil minister Mohammed bin Hamad al-Rumhy said earlier this month that an extension was the most likely outcome. Since then, Opec and the IEA have projected an extended challenge from US shale production to the group's market share.

Russia's largest crude producers "all proposed that we remain in the deal, with the same quotas, and meet and discuss [further strategy] at the end of the first quarter", Lukoil first executive vice-president Ravil Maganov said after a meeting yesterday with Russian energy minister Alexander Novak.

The Opec and non-Opec Joint Technical Committee (JTC), which reviews market conditions, will convene on the 4 December, and the Joint Ministerial Monitoring Committee (JMMC) will meet on 5 December. Opec will also meet that day, and the wider group on 6 December.

By Rowena Edwards