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Opec may hold formal meeting if members agree on oil in Algiers

Monday, September 19, 2016 - 07:03

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Opec may convene an extraordinary meeting if the group's ministers reach a consensus on oil markets at an informal gathering in Algiers later this month, Secretary General Mohammed Barkindo said, according to Algeria's official news agency.

[CAIRO] Opec may convene an extraordinary meeting if the group's ministers reach a consensus on oil markets at an informal gathering in Algiers later this month, Secretary General Mohammed Barkindo said, according to Algeria's official news agency.

Mr Barkindo said he is "optimistic" about the informal session in Algiers to be held Sept 27 on the sidelines of a conference of the International Energy Forum, Algeria Press Service reported Sunday. He made his comments after meeting with Algeria's Energy Minister Nourredine Boutarfa, it said.

The Sept 27 gathering will be a "meeting of consultation and not of decision-making", unlike Opec's meeting in Oran, Algeria, in 2008, when it agreed to cut production, Mr Barkindo said the previous day, APS reported on Saturday.

Almost two years after the Organization of Petroleum Exporting Countries set a strategy to eliminate the global oil glut by pressuring rivals with lower prices, markets continue to struggle with excess supply and crude remains capped below US$50 a barrel.

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Opec plans to hold informal talks with competitor Russia in Algiers, fanning speculation that producers may agree on an output cap to shore up prices.

A freeze would be the group's first decision to limit output since Opec adopted a Saudi-led plan in 2014 allowing members to pump more to protect market share from increased production from the US to Russia. Opec members and Russia failed to agree at a meeting in Doha in April to limit production after Iran declined to attend and Saudi Arabia refused to proceed without all of the Opec states participating.

Saudi Arabia, Opec's biggest producer, is willing to discuss a possible freeze, Khalid Al-Falih, the country's oil minister, said in an interview last month. Al-Falih said he doesn't "believe that an intervention of significance is required" and doesn't support a production cut.

Iran insists it will be ready to decide on capping production once output recovers to what it was before international sanctions on the country were tightened in 2012.

The International Energy Agency trimmed projections for global oil demand next year by 200,000 barrels a day to 97.3 million a day, the Paris-based group said in a report earlier this month.

The IEA reduced growth estimates for this year by 100,000 barrels a day to 1.3 million a day, citing a deceleration in China and India this quarter coupled with vanishing growth in developed economies.

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