The Organization of the Petroleum Exporting Countries (OPEC) and allied oil producers will extend output cuts for another 6 months if recent measures to boost the market are not enough, UAE’s energy minister has said.

While the plan to cut crude output by 1.2 million barrels per day (bpd), recently agreed by OPEC and world major oil suppliers led by Russia, has not been introduced so far, members are ready to extend the deal.

Talk of a possible extension of the OPEC+ deal comes as the oil market suffered huge losses last week, with crude benchmarks – West Texas Intermediate (WTI) and Brent – falling to more-than-a-year lows amid oversupply fears. On Monday, Brent crude was trading at just above $54 per barrel, while US crude benchmark WTI slipped to about $45.50.

Read more

UAE Energy Minister Suhail al-Mazrouei, who also currently serves as the president of OPEC, believes that with the current surplus estimated at 26 million barrels, compared to 340 million barrels in 2017, market rebalance can be reached in the first quarter of next year.

However, if the plan does not work, OPEC and allies can always have an “an extraordinary meeting” to settle the issue.

“What if the 1.2 million barrels of cuts are not enough? I am telling you that if it is not, we will meet and see what is enough and we will do it,” Mazrouei stated after the meeting of the Organization of Arab Petroleum Exporting Countries in Kuwait on Sunday.

“If we are required to extend for [another] six months, we will do it… I can assure you an extension will not be a problem,” the minister said as cited by media. He added even longer extensions can be discussed.

The UAE position was supported by Iraq. Oil Minister Thamer Al Ghadban believes that producers are ready to renew the agreement or increase cuts in case the market does not balance, according to AFP.

It is believed that the cuts which are to be implemented in January will eventually boost the oil market next year, according to the forecast issued by energy information provider Argus Media, quoted by CNBC. The Brent crude price is projected to slowly rise during 2019, from $65 per barrel in the first quarter to $80 a barrel in the fourth quarter, Azlin Ahmad, editor for crude oil at Argus, said.

For more stories on economy & finance visit RT's business section