Ahead of a meeting on Monday that would possibly address the increasing output in Libya and Nigeria, oil prices remained on a flat. The joint session of OPEC and the non-OPEC meeting was held later in the day.
After a forecast, Friday by a consultancy about a possible rise in OPEC production in July, the London Brent crude for September went up 2 cents at $48.08 per barrel. And the contract dropped 2.5$. However, the September delivery for NYMEX crude remained unchanged at $45.77.
Market conditions to be reviewed on Monday
A meeting will be held in the Russian City of St. Petersburg on Monday by the OPEC and non-OPEC producers to revise the market conditions and analyze proposals in line with their agreement to reduce output. Close sources reveal that the discussions suggest the meeting would devise plans to curb production from Libya and Nigeria.
A strategist for commodities brokerage Okato Shoji in Tokyo, Kaname Gokon said output cuts by Nigeria and Libya would be close to impossible because Libya was just returning from the Civil war. In a deal extended to March 2018, some non-OPEC and OPEC states agreed to cut oil production by 1.8 million barrels daily.
According to a report by the Financial Times, Alexander Novak, Russian Energy Minister said Nigeria and Libya should cap production output only when their production stabilizes. Essam al-Marzouq, Kuwait’s oil minister, said that compliance was the best and stricter measures are possible.
However, the OPEC Secretary General, Mohammad Barkindo pointed out on Sunday that the effort geared towards striking a balance in the oil market is moving slowly than expected but will pick up during the second half of this year.
ANZ bank stated that oil appears to be glued to a strict range as investors envisage OPEC’s actions to make the oil market balanced. In line with the speculations, the United States is contemplating on sanctioning Venezuela if it alters the OPEC nation’s crude exports by halting dollar payments.