Report: Saudi Arabia wants OPEC to extend production cuts

MOSCOW, Apr 12 (PRIME) -- Saudi Arabia has told OPEC that it wants to extend the cartel’s agreement to cut crude oil production for another six months when the group meets in May, The Wall Street Journal reported late on Tuesday citing people familiar with the matter.

Saudi support is essential for the 13-member Organization of the Petroleum Exporting Countries to renew its agreement at its next meeting, in Vienna on May 25. The group committed last year to cut about 1.2 million barrels of oil a day in a bid to bring a vast global oversupply of crude back in line with demand and thus raise petroleum prices.

The agreement helped raise oil prices about 20% after it was announced on November 30, 2016 and then joined by Russia and 10 other non-OPEC producers that pledged to trim another 558,000 barrels a day.

But prices have stalled at about U.S. $56 a barrel, and the cuts haven’t drained oil inventories down as fast as expected, OPEC officials said. That is partly because U.S. oil producers took advantage of the rise in prices and raised their own output.

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