Meanwhile, analysts said there was caution in the markets ahead of a meeting of leaders from the world's richest economies that was expected to expose deep divisions with U.S. President Donald Trump over trade and climate change. "The meeting yesterday gives us, however, a feeling that OPEC is worn out by the lack of results so far and does not have a consensus anymore to have the five-year average in stocks as a policy target".
Oil prices edged up on Friday after tumbling in the previous session when the Organization of the Petroleum Exporting Countries (OPEC) and the other main producers agreed to extend output cuts.
The Opec cuts have helped to push oil back above $50 a barrel this year, giving a fiscal boost to producers, many of which rely heavily on oil revenues and have had to burn through foreign-currency reserves to plug holes in their budgets, Reuters reports.
Concerns also remain that Opec-led production cuts will only stimulate a further rise in output from the United States, where producers can operate at much lower costs.
A fall in oil prices following the OPEC meeting demonstrated the market's ongoing term concerns.
"The December meeting was a breakthrough", he said.
Founded in 1960, today OPEC accounts for over one-third of global oil production, and some 70% of global oil reserves. For OPEC, the price reaction is surely frustrating. More important, global oil inventories will inch closer to their five-year average levels. "It seems it is good for both". Thursday's meeting was expected to sign off on this.
The export curbs, if implemented, would affect big US refiners such as Valero Energy Corp. and Exxon Mobil Corp., forcing them to buy similar crude elsewhere, such as Mexico, Canada or Venezuela.
Here is an account of what the deal entails for oil producing and consuming nations. He appeared to have played his cards close to his chest. "We also talked to the Iraqi prime minister by the presence of the minister of oil about the future of the economic relations and the other fields to strengthen them for the bilateral interests". "Then, the fourth quarter will get us to where we want". "There's a rational skepticism globally, but it misses the mark".
Saudi Arabia has shipped 1.21 million barrels a day of crude to the US on average so far this year, according to Bloomberg calculations based on official customs data.
Some of OPEC's customers are happy to see an alternative.
The US, which is the world's largest oil consumer, has also stayed out and instead become a strong competitor for the OPEC.
However, a production surplus could return in 2018 if the deal is not rolled over again, as new projects continue to come online and USA shale production is set to grow, according to Fitch.
Gary Ross, head of global oil at PIRA Energy, a unit of S&P Global Platts said yesterday that Russian Federation and Saudi Arabia will be the biggest supporter of the oil production cut down because they have some huge events coming on the way in near future.