Goldman's Jeff Currie says talk that OPEC could start defending its market share again to squeeze US producers is the wrong way to look at the situation: "Shale and OPEC are taking on the worldwide oil [producers] that are sitting at the top [of the cost curve]".
Saudi Arabia›s Energy Minister Khalid Al-Falih (L) and Russia's Energy Minister Alexander Novak attend a joint briefing in Beijing on Monday.
"These combined volumes could largely offset the benefit of the extended cuts", Goldman Sachs said, keeping its average Brent price forecast for the third quarter at $57 per barrel.
"We assume that the main thing is not the price, but the (intention) to bring average monthly reserves back to the average five-year level", the minister said.More news: Where's the drama? Blowouts the rule in these NBA playoffs
The move was partly matched by non-OPEC producers led by Russian Federation.
Ministers from OPEC and the non-OPEC countries meet to decide policy on May 25 in Vienna, and OPEC has also invited two small producers not involved in the original deal, Egypt and Turkmenistan, to attend.
After the cartel cut production, a 22 per cent bounce to a high of US$57.10 in January was erased partly as United States of America crude output and shale production rose.
Benchmark Brent oil prices rose, trading up $1.39 at $52.23 per barrel by 1407 GMT as the market had previously expected the cuts to be extended by as little as six months.More news: Trump assails 'witch hunt' after naming of special counsel
Kazakhstan, the biggest producer in the former Soviet Union after Russian Federation, isn't ready to join an extended accord automatically, its Energy Minister Kanat Bozumbayev said Monday, according to Interfax. "I anticipate prices to consolidate above $50 in the coming weeks". A recent increase in Libyan output, together with a surge in North American shale production and signs of recovery in Nigeria, may undercut OPEC's strategy to re-balance the market and prop up prices. Libya's crude production has risen to more than 800,000 barrels a day, the most since 2014, while Nigeria's 200,000-barrel-a-day Forcados pipeline is ready to export again after nearly continuous halts since February 2016.
Russia's Mr Novak said that "preliminary consultations show that everybody is committed" to the output agreement and no nation is willing to quit.
If producers maintain their cuts at the current pace, it could push the market into a small deficit by the fourth quarter, said Edward Bell, director of commodity research at Emirates NBD in Dubai.More news: Comey's predecessor to head Trump-Russia probe
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