Libya and Nigeria could be key elements in an OPEC output agreement this week as other members are pushing to rescind the two countries’ exemptions from production cuts and have them join the rest of the organization’s efforts to ward off a supply glut.
Neither country seems keen to do so, citing their continued security risks, but having boosted their crude output significantly over the last two years, their pleas may be falling on deaf ears. Delegates told S&P Global Platts that they will be asking Libya and Nigeria to accept a production cut quota if OPEC can reach a new supply accord when it meets Thursday in Vienna. Libya and Nigeria, both suffering from internal disruptions, were not given quotas when OPEC and 10 non-OPEC allies instituted 1.8 million b/d in cuts that are set to expire at year-end.
Saudi energy minister Khalid al-Falih, OPEC’s de-facto leader, has in recent weeks traveled to Libya and Nigeria to press them on the exemptions, though no public commitments have been announced. Kachikwu has not spoken to reporters since arriving in Vienna ahead of the OPEC talks, and a Nigerian delegate declined to comment. Mustafa Sanalla, the head of Libya’s National Oil Corp, who will be representing Libya at the OPEC meeting, is scheduled to arrive in Vienna later Wednesday.
Source: S&P Global Platts