Oil prices surged around 1 percent on Monday, July 24, after leading OPEC producer Saudi Arabia pledged to cut exports in August to help reduce the global crude glut, and Halliburton Co’s (HAL.N) executive chairman said the U.S. shale drilling boom would probably ease next year.
Saudi Energy Minister Khalid al-Falih said his country would limit crude oil exports at 6.6 million barrels per day (bpd) in August, almost 1 million bpd below levels a year ago.
The Russian Energy Minister Alexander Novak also told reporters that an additional 200,000 barrels per day of oil could be removed from the market if compliance with a global deal to cut output was 100 percent.
Brent crude futures LCOc1 were up 46 cents or .97 percent to $48.52 a barrel by 11:55 a.m.(1555 GMT) U.S. West Texas Intermediate (WTI) crude futures CLc1 were up 49 cents or 1.1 percent to $46.26 a barrel.
The Saudi and Russian energy ministers were in St Petersburg for a gathering of the Organization of the Petroleum Exporting Countries and some other producers. Ministers discussed their agreement to cut production 1.8 million bpd from January 2017 through March 2018.
Falih said OPEC and non-OPEC partners were committed to cut output longer if necessary but would demand that any non-compliant nations stick to the agreement.
There was no discussion of deeper output cuts, and OPEC Secretary-General Mohammad Barkindo said Nigeria has no intention of going beyond its production target of 1.8 million bpd.
Libya’s oil production has reached 1.069 million barrels per day (bpd), a Libyan oil source told Reuters, which is above a high reached earlier this month.
OPEC members Nigeria and Libya have been exempt from the output cuts, and market watchers remain concerned about their production. In the United States, rig counts were up to 764 in latest week from 371 rigs a year ago, Reuters reports.
