Saudi minister calls for 1 mln bpd global oil output cut

Oil Price Enters Bear Market Even as U.S. Crude Output Hits Record-High

Oman oil minister says majority of OPEC and its allies support cut

Oil prices have staged a recovery, climbing above $70 a barrel after Saudi Arabia said the world's major crude producers agreed that supply needs to be significantly cut next year.

An official from Kuwait, also an OPEC member, on Monday said that major oil exporters over the weekend had "discussed a proposal for some kind of cut in (crude) supply next year", although the official did not provide any detail.

"The technical analysis we reviewed yesterday shows that we need a reduction approaching one million bpd to balance the market", he told an energy conference in Abu Dhabi. "We are not in the business of pinpointing a price going forward".

The next OPEC and non-OPEC ministerial meeting will convene in Vienna on December 4, just ahead of the OPEC summit. The producers need prices that are high enough to balance their budgets and low enough to stimulate demand and shield themselves from attacks from the White House, all while they contend with wild swings in supply as sanctions hit OPEC member Iran. In the meantime, the Kingdom said it is taking the lead by cutting its output to 500,000 barrels a day come December.

The group's caution arises partly from the unpredictability of Iranian supply.

"One thing that is abundantly clear, OPEC is in for a shale shocker as United States crude production increased to a record 11.6 million barrels per day and will cross the 12 million threshold next year", Innes said.

A meeting between Novak, Al-Falih and other producers on Sunday yielded no formal change in supply policy, but did acknowledge they may need "new strategies".

Global oil prices tumbled into a bear market last week, down more than 20% from their recent peak.

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Worldwide benchmark Brent crude oil futures were at 71.11 dollars per barrel at 0051 GMT, up by 93 cents, or 1.3 per cent from their last close. Futures are still down about 18 percent from a 2014 high reached early last month. The kingdom still has some work to do persuading other major producers to follow suit, notably Russian Federation, the largest non-OPEC nation in the alliance.

Dudley said the waivers had been unexpected, so the market had been readjusting.

Decision comes amid fears of oversupply. "They seem to be sitting squarely on the fence about pulling the barrels back".

"Saudi Arabia is flexible and will do what other countries agree to do".

USA energy firms last week added 12 oil rigs in the week to November 9 looking for new reserves, bringing the total count to 886, the highest level since March 2015, Baker Hughes energy services firm said on Friday.

"Ideally, we don't like to cut", Al-Falih said. "Opec has reduced production since June and quite frankly we would have been over $100 by now [without those cuts]". "We're seeing some signs of this coming out of the U.S. We have not seen the signs globally, nor can we predict that they will persist into 2019".

"We'll make sure we'll steer the global oil markets ... to make sure we don't jerk the oil markets into swinging either side", said Mr Al Falih.

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