🐂 Not all bull runs are created equal. November’s AI picks include 5 stocks up +20% eachUnlock Stocks

Demand uncertainty weighs on decision over oil pact - Russia minister

Published 24/06/2019, 12:58
© Reuters. FILE PHOTO: Russian Energy Minister Alexander Novak attends a session of the St. Petersburg International Economic Forum

By Vladimir Soldatkin

ST PETERSBURG (Reuters) - Uncertainty over global oil demand in the second half of this year, including the effect of U.S. sanctions, will have a big impact on whether Russia backs extending a deal on oil output cuts, Russian Energy Minister Alexander Novak said on Monday.

The Organisation of the Petroleum Exporting Countries and other leading oil producers have an agreement to cut their combined oil output but this expires at the end of this month. Talks on whether to extend the pact are scheduled for July 1-2 in Vienna.

Speaking to reporters on the sidelines of an energy forum in St Petersburg, Novak, when asked about an extension of the deal between OPEC and non-OPEC oil producers, said: "It's too early to say."

"We need to wait for, among other things, the G20 heads of state meeting. Let's see what questions they discuss there, how the economy develops, the situation on the market," Novak told reporters.

The G20 heads of state meet in the Japanese city of Osaka later this week.

Asked what factors were proving hard to predict when weighing the future of the output cut deal, Novak said: "The consumption of oil in the third and fourth quarters, the pace of growth of the world economy, the world's biggest economies."

"Also the influence of sanctions restrictions on the world market. We need to clearly understand what that will influence, and how, and what the consequences will be," Novak said.

U.S. sanctions on Iran, coupled with existing sanctions on Venezuela, are expected to reduce crude supplies reaching the global oil market.

Referring to the meeting in Vienna on July 1-2, Novak said: "By the time of the OPEC/non-OPEC meeting we will have a clear understanding of the situation, options will be proposed. Now I don't want to say anything, because nothing has changed."

© Reuters. FILE PHOTO: Russian Energy Minister Alexander Novak attends a session of the St. Petersburg International Economic Forum

Earlier, Novak said the pact so far had been a successful example of international co-operation stabilising oil markets, and that continued cooperation was more important now than ever before.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.