Crude exporting giant Saudi Arabia is lobbying oil ministers to agree next week on a nine-month extension to OPEC-led supply cuts, sources told Reuters, as Riyadh looks to make sure a price-plunging oil glut is erased.
The Organization of the Petroleum Exporting Countries, non-member Russia and nine other producers are cutting oil output by about 1.8 million barrels per day (MMBPD) until March 2018, and will discuss extending the deal at a Nov. 30 meeting in Vienna.
Benchmark Brent crude have risen to roughly $65 a barrel, the highest since 2015, due to lower inventories, Kallanish Energy reports.
However, OPEC is wary prices could fall again since excess supply persists, while a flare-up in Middle Eastern political tensions has also played a part in the rally, Reuters reported.
“The Saudis are lobbying to have a decision in November for nine months,” a senior oil industry source with knowledge of the matter who requested anonymity told Reuters.
The OPEC-led group is also weighing other options. Reuters reported in October, citing unnamed OPEC sources, the producers were leaning towards extending for nine months, but could postpone a decision until early next year, given the recent rise in prices.