Saudi Arabia Pledges Commitment to Production Deal and is Optimistic on Results

Saudi Arabia will adhere strictly to its commitment to cut output under the global agreement among oil producers, its energy minister said on Monday, expressing confidence that OPEC’s plan to prop up prices would work.

Saudi Energy Minister Khalid al-Falih, speaking at an industry event in Abu Dhabi, also said he was encouraged by signs of commitments by other participants in the deal since it took effect on Jan. 1.

“Many countries are actually going the extra mile and cutting beyond what they’ve committed… I am confident about the impact… and I am very encouraged about those first two weeks,” Falih said.

The comments are the latest in a series of assurances from officials that participants will follow through on the agreement intended to help get rid of a glut. Compliance with the deal will be a key influence in early 2017 on oil prices LCOc1, which at $56 a barrel are about half their level of mid-2014.

Under the accord, the Organization of the Petroleum Exporting Countries and Russia and other non-members will curtail oil output by nearly 1.8 million bpd, initially for six months.

via Reuters

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