Lukoil CEO: OPEC+ oil cut deal may remain in 2019, 2020

ST. PETERSBURG, May 24 (PRIME) -- The OPEC+ oil production cut agreement may remain in 2019 and 2020 on condition that it proves its efficiency, oil major Lukoil CEO Vagit Alekperov told reporters on Thursday.

The oil market has already been balanced, but there is no need to cancel the OPEC+ deal, he said.

“The goals have been reached, the market is balanced… I’m deeply convinced that this agreement, which balanced the market, made it more predictable, that’s why we should not cancel this deal, but it should become more flexible taking into account how the market is being formed…,” Alekperov said.

“We support that the deal should remain, but volumes of restrictions should be flexible. Yes, it can be kept in force both in 2019 and 2020.”

Russian companies have not yet discussed the future fate of the OPEC+ deal with the Energy Ministry, Alekperov said.

In November 2016, OPEC and non-OPEC states agreed to reduce their oil production to rebalance the market. Russia joined the agreement in December 2016 with a promise to cut output by 300,000 barrels daily compared with the level of October 2016. The agreement was prolonged until the end of 2018 in November 2017.

Lukoil keeps its budget plan for 2018 assuming oil price of U.S. $50 per barrel, Alekperov also said.

The company will continue discussing economic changes to the West Qurna-2 field contract with Iraq until the end of this year, he also said.

“There is a number of parameters there, which we would like to revise… The Iraqi side admitted that economic parameters should be improved, the group is working now,” he said.

Lukoil also continues to consider projects in Iran, he added.

Alekperov also said that the planned reduction of fuel excises in Russia will not reduce their prices, but will temporarily stabilize them.

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