Daily Times

LONDON: Oil prices slipped Friday, as Russia said it would wait for details of OPEC’s surprise agreement to cut crude output before deciding on any changes to its own production.

The Organization of the Petroleum Exporting Countries — of which Russia is not a member — agreed this week to cut production by some 750,000 barrels a day in a move aimed at supporting prices.

“During October and November the OPEC countries will work out the specific parameters of their proposal,” Russian news agency Interfax quoted Energy Minister Alexander Novak as saying.

“We are talking about maintaining levels at volumes that have been reached, but it is still being discussed at what level,” Novak said, insisting he “would not comment on specific levels”.

Around 1115 GMT, US benchmark West Texas Intermediate for delivery in November was down 18 cents at $47.65 a barrel.

Brent North Sea crude for November shed 55 cents to $48.69 a barrel compared with the close on Thursday.

Initial euphoria over what would be the first output cut by OPEC in eight years sent prices soaring six percent on Wednesday but the rally fizzled as traders began to question the cartel’s ability to see the deal through. A technical committee has been formed to flesh out the details ahead of the cartel’s formal meeting on November 30, including the allocation of the cuts for each of the cartel’s 14 members, who together pump out more than one-third of world crude.

“There are concerns about the execution of OPEC’s new production targets,” said IG Markets analyst Chris Weston.

“Even when the new agreement is finalised, the actual reductions won’t materialise until 2017 and the prospect of various nations exceeding targets is real.” Following a meeting that included non-member Russia, OPEC stunned markets Wednesday by saying it planned to trim total production. This followed talks in Algiers on how the cartel could prop up prices that have plunged from $100 in mid-2014 to below $30 at the start of 2016, mainly owing to excess supplies.