OPEC poised to extend oil production cuts to support prices

VIENNA — Key OPEC oil ministers expressed preference Thursday for extending crude output cuts until the end of next year, strengthening expectations that the oil cartel will decide to continue pumping less oil for more dollars.

Benchmark crude prices are now close to $60 a barrel, up almost 20 per cent since a year ago, when the Organization of the Petroleum Exporting Countries and their non-OPEC partners agreed to reduce supply by a daily 1.8 million barrels to push up prices.

Even bitter rivals Saudi Arabia and Iran appeared on the same page going into Thursday’s meeting.

“My preference is to go for a 9-month extension,” Khalid Al-Falih of Saudi Arabia told reporters, while Bijan Namdar Zanganeh, his Iranian counterpart, said the meeting will “reach agreement about rolling over” the supply cuts.

Traditional tensions between the two nations have led to disarray in the past and have spiked in recent months, with their struggle for Middle East dominance potentially exacerbating different positions on oil.

The Saudis favour continued cuts, but Iran wants greater market share over the longer term as it claws back from the effect of more than a decade or sanctions that were lifted as part of its 2015 nuclear deal with six world powers. Now pumping below 4 million barrels a day, Iran has said it wants to add another 1 million barrels within three years.

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