Iraq, Kuwait, the United Arab Emirates, Russia and Saudi Arabia will extend an OPEC agreement for oil production cuts for another six months. "We all know that Iraq has big needs for gas especially in generating electric power".
Should that fail to balance the market, OPEC and its allies will hold an extraordinary meeting, UAE Energy Minister Suhail al-Mazrouei said on Sunday.
During their meeting next April, the producers are also expected to sign a long-term agreement to formalize cooperation between OPEC and non-OPEC members over oil output.
OPEC cuts may end up being deeper than agreed because of planned maintenance and production snags in some member countries, Al Mazrouei said.
Brent for February settlement declined as much as 54 cents to $49.93 a barrel on the London-based ICE Futures Europe exchange, before paring losses to trade at $50.36 at 11:27 a.m.in Tokyo.
Officials at the worldwide oil cartel OPEC say they might consider additional measures to support global oil prices in case the most recent round of output cuts doesn't work; meanwhile, oil prices are showing signs of recovery amid fears of disinvestment in the USA shale industry.
The decline in prices prompted USA shale producers to cut back on their drilling plans for next year.
'I think that we can easily do with this surplus and reach market rebalance in one or two months.in the first quarter of next year, he said.
This, however, could prompt an upward revision of investment plans by USA shale producers, which could curb any major spike in oil prices.
Saudi Arabia's OPEC governor, Adeeb Al-Aama, who attended the OAPEC meeting, said oil market oversupply had fallen to 37 million barrels of crude in November from 340 million barrels in January 2017, when OPEC and its allies began cutting production in an attempt to lift prices.
The S&P 500's energy index shed 4 percent Monday, led by Hess Corp., which lost 12 percent after Venezuelan forces temporarily halted ships working at a Hess-Exxon Mobil project offshore from Guyana.
Ghadhban said he believes that the new measures taken by producers will "stop the slide in oil prices".
At a press briefing in Kuwait, Iraqi, the U.A.E. and Algerian energy ministers took turns repeating the message that OPEC will deliver its 800,000 barrels per day cut and continue their cooperation with other producers to balance supply and demand.
"Oil ministers are already taking to the airwaves with a "price stability at all cost" mantra", Stephen Innes of financial services company Oanda said.