OPEC hints at oil production cuts continuing, sending crude prices up

Crude oil prices rose Monday after OPEC leaders signaled that they would likely extend current crude production cuts for another nine months.

OPEC President Minister Khalid Al-Falih said he would extend oil production cuts another nine months

Brent prices were up 2.2 percent to $66.19 per barrel while U.S. prices climbed 2.4 percent to $59.86 a barrel.

The Organization of Petroleum Exporting Countries will have its official meeting Monday afternoon. They will have a separate meeting Tuesday with Russia.

OPEC agreed last year to cut oil production by 1.2 million barrels per day to keep prices up. Saudi Energy Minister Khalid al-Falih said Sunday that no additional cuts were needed.

“By the end of the first day we’ll know what the deal is,” Rapidan Energy senior analyst Allyson Cutright said. “They (OPEC members) aren’t going to agree to anything that Russia hasn’t already signed on to.”

Russian President Vladimir Putin said he reached agreement with Saudi Crown Prince Mohammad bin Salman to extend the current crude oil production cuts when they met at the G-20 conference in Osaka, Japan.

“We will support the extension, both Russia and Saudi Arabia,” Putin said. “As far as the length of the extension is concerned, we have yet to decide whether it will be six or nine months. Maybe it will be nine months.”

Iranian Oil Minister Bijan Zanganeh said he had “no problem” with supporting oil supply cuts by nine months.

“It is going to be an easy meeting as my stance is very clear,” Zanganeh said.

He also criticized “unilateralism” among members of the energy alliance, saying it could be the death of OPEC. Though it is a member, Iran has been critical of OPEC because some members threatened to increase production to make up for Iran’s inability to export due to U.S. sanctions.

“The important thing to me is that OPEC remains OPEC,” Zanganeh said. “It has lost its authority and is on the verge of collapse.”

ByNicholas Sakelaris