The current oil cut agreement between the Organization of the Petroleum Exporting Countries (OPEC) and some non-OPEC countries should remain, but the oil production quota for producers should be "flexible", President of the Russian oil company Lukoil Vagit Alekperov said on Thursday.
Alekperov during a press conference at St. Petersburg International Economic Forum said that it is not necessary to break the oil cut agreement.
He explained that OPEC and some of non-OPEC oil producing countries proved that the agreement and its output positively impacted the oil market.
OPEC and non-OPEC countries led by Russia, agreed on Nov. 30, 2017 to extend their oil production cut by a further nine months to the end of 2018.
Previously in 2016, OPEC members unanimously agreed to lower oil production by 1.2 million barrels per day (bpd) down to 32.5 million bpd, which became effective on Jan. 1, 2017. This was the organization's first production cut in eight years, and its first intervention in the global oil market since mid-2014 when oil prices began to fall.
Furthermore, non-OPEC oil producing countries led by Russia agreed to contribute a cap of 600 thousand bpd, which brought the total production cut up to 1.8 million bpd.
Alekperov said that the many factors that could impact the global oil market and prices would be discussed at the upcoming meeting between oil producer countries between June 20 and 21.
He also stressed the likelihood of another oil cut extension through 2019 and 2020.
"The global oil market has stability with the help of the oil cut decision and the later extension of the agreement," he concluded.
Reporting By Emre Gurkan Abay in Russia,
Writing By Gulsen Cagatay