United Arab Emirates' minister for energy Suhail al-Mazroui has stated that he expects the Organisation of Petroleum Exporting Countries (OPEC) and non-OPEC countries to extend global supply cuts at the November 30, 2017 meeting.
This is coming as OPEC in its November oil market report released yesterday, increased the forecast for 2018 demand for its crude by 360,000 barrels per day, from last month's report to 33.42 million bpd.
But the tensions in the Middle East have raised the prospect of disruptions of crude oil supply, though the price of Brent was steady yesterday at $63 per barrel, close to its two-year high.
Speaking yesterday at the Abu Dhabi International Petroleum Exhibition Conference (ADIPEC), al-Mazroui said his prediction was that OPEC would continue to do what it would take to rebalance the market.
He added that while he had not heard any OPEC members discussing the possibility of not extending the deal, the time and duration of an extension was still to be decided.
OPEC members were reportedly forming a consensus around extending by nine months their production cuts deal with other crude exporters.
An extension would prolong the agreement among OPEC, Russia and other oil-producing nations to keep 1.8 million barrels a day off the market through the whole of next year.
The exporters reached the deal last December and had already extended the agreement once through March 2018.
Reuters reported last month, citing OPEC sources, that producers were leaning towards prolonging the agreement until the end of 2018, though the decision could be postponed until early next year depending on the market.
UAE's energy minister said he saw no need for the decision to be delayed beyond the November 30 meeting in Vienna.
His Omani counterpart also voiced confidence there would be an agreement this month.
"I don't see the need to delay the decision until March... We are not going to meet in that quarter unless it is extraordinary," Mazroui said at an energy industry conference.
If there is a decision to extend the supply cut it will be until the end of 2018, said the Omani oil minister, Mohammed bin Hamad al-Rumhi, adding that he did not think producers would agree to deepen the curbs.
Mazroui, whose country next year holds the rotating OPEC presidency, said that while the UAE backed an extension, he could not say yet whether it would support maintaining the supply cut until the end of 2018.
In a related development, OPEC yesterday increased the forecast for 2018 demand for its crude by 360,000 bpd, from last month's report to 33.42 million bpd.
It also said industrialised countries' September commercial oil inventories, a key marker OPEC uses to measure market balance, fell by 23.6 million barrels to 2.985 billion barrels.
Stocks were 154 million barrels above the five-year average, the excess that OPEC aims to eliminate.
OPEC Secretary-General Mohammad Barkindo, speaking at the same event, said participants in the deal were committed to achieving market stability.
However, the Brent oil price was steady at close to two-year high yesterday, with support from Middle East tensions and record long bets by fund managers balanced by rising U.S. production.
Benchmark Brent crude futures traded at $63.47 a barrel, up 14 per cent so far this month, while the U.S. West Texas Intermediate (WTI) crude futures rose to $56.68 per barrel.
Tensions in the Middle East have raised the prospect of disruptions, but it was unclear whether a strong earthquake that hit Iran and Iraq on Sunday had affected the region's oil production.
Bahrain said at the weekend that an explosion that caused a fire at its main oil pipeline on Friday was caused by sabotage, linking the attack to Iran, which denied any role.