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OPEC needs to cut output by 700,000 bpd more for Brent to hit USD 70 – Rystad

Gasoil News - Published on Mon, 17 Dec 2018

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Reuters quoted oil and gas consultancy Rystad Energy as saying that oil producer cartel OPEC and its partners will need to keep production lower than their agreed target through 2019 for benchmark Brent crude to come back to USD 70 a barrel. The Organisation of the Petroleum Exporting Countries and its Russia-led allies agreed to slash oil production by a bigger-than-expected 1.2 million barrels per day.

Rystad analyst Bjornar Tonhaugen said that the producer group needs to stay 700,000 bpd below its agreed target of 31.8 million bpd through 2019 in order to bring a recovery in benchmark Brent crude prices to the USD 70 per barrel level. He said “The agreed production cuts will not be enough to ensure sustained and immediate recovery in oil prices.”

However, crude prices have see-sawed of late on worries of a global economic slowdown on one hand, and a boost from production cuts on the other.

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Posted By : Nanda Koijam on Mon, 17 Dec 2018
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