Iran storms out of OPEC meeting to boost oil supply

Indian Minister of Petroleum and Natural Gas and Skills Development and Entrepreneurship Mr Dharmendra Pradhan with Nigerian Minister of State for Petroleum Dr Ibe Kachikwu at the 7th OPEC International Seminar in Vienna Austria on Wednesday (20/6

High oil prices hurting fiscal balance, says Pradhan

In the past year, many promised to prioritize spending discipline over production expansion after previously rushing to pump more oil when prices recovered.

Falih, in a nod to the problems with faltering production in Venezuela, Iran, and Libya, acknowledged that "not every country" will be able to join the production increase. U.S. light crude was $1.80 higher at $67.34.

Countries in the OPEC oil cartel have agreed to a new oil output level that effectively increases production by nearly 1 million barrels per day.

"In the long term, this will have a negative effect on the global economy even if, in the short term, it might be positive for other non-US producers", Rainer Seele, chief executive at Austria's oil company OMV, said in Vienna where OPEC officials and ministers and top oil industry executives attended a seminar this week.

Harry Tchilinguirian, head of oil strategy at French bank BNP Paribas, told Reuters Global Oil Forum he expected OPEC and Russian Federation to agree a compromise that would see a small increase in global oil production.

Trump's involvement in pressing for OPEC to act - which in addition to his tweets include a behind-the-scenes request for a 1 million-barrel-a-day supply hike - could make it hard for Tehran to accept a compromise.

Iran is understood to want a coded critique of the USA, which recently ended an global nuclear agreement with Iran, in the final Opec agreement on Friday.

Moscow and Riyadh have argued that OPEC should heed calls from major oil-consuming countries like China, India, and the United States to lift their 2016 production freeze to rein in rising oil prices.

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The market is contending with exactly how much output will change.

OPEC energy ministers expressed optimism Thursday they were nearing a compromise on oil output policy, with Saudi Arabia acknowledging that a big production hike would be "politically unacceptable" to archfoe Iran. "Nigeria under this scenario must build capacity to participate easily when OPEC expands its production", he said.

Falih said the oil market had now rebalanced and his aim was to prevent a shortage of crude in future that could squeeze the market.

"This shows that China is a significant outlet for USA crude exports and the early indications are that the exports would be much higher in Q2 2018 given the lower WTI-Brent differential which made the arbitrage to Asia look more attractive", Sivanandam noted.

OPEC's deal to release more supply centres on the idea of returning to 100 per cent compliance with existing, agreed cuts.

Falih also said the real increase for OPEC and non-OPEC would be smaller than the nominal gain of 1 million bpd.

If Iran continues to oppose a deal when ministers formally gather on Friday and musters the support of others - perhaps Venezuela, Iraq and Algeria - OPEC may be unable even to issue a communique, let alone decide to increase production.

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