Saudi said to have won provisional backing for Opec+ oil production cuts

(Sharecast News) - Saudi Arabia has reportedly won provisional backing for further oil production cuts by the Opec+ group, boosting oil prices to the highest in three weeks ahead of a crucial meeting of the cartel. The Financial Times cited people close to the kingdom as saying that Saudi Arabia, the group's most powerful member, has a provisional deal for further group-wide production cuts that will see other members agree to contribute, after difficult discussions with countries more hesitant to cut supply.

The kingdom has warned it could unwind its existing voluntary cuts if other members do not make a greater contribution, according to delegates and people close to Riyadh's thinking, leaving oil markets on a knife edge if the deal cannot be finalised.

"Saudi Arabia has been very clear in saying that [production cuts] have to be a shared effort," said Jorge León at Rystad Energy and a former Opec official.

The FT said that people familiar with Saudi Arabia's thinking have said an additional group-wide production cut of about 1m barrels a day - about 1% of global supply - has gained support, though the number has not been finalised and could be higher or lower.

The kingdom would also extend its existing temporary voluntary curbs - also of 1m b/d - that are due to expire at the end of this year, while Russia has also made smaller voluntary cuts to exports.

According to the FT, delegates and people close to the Opec+ talks said the deal was still being finalised on Thursday morning, with the formal meeting of Opec+ ministers expected to start at around 1530 GMT.