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Russian Oil Minister Sees Possible Extension of Deal To Cut Oil Output

Russia -- Russian Energy Minister Aleksandr Novak attends a meeting of the 4th OPEC-Non-OPEC Ministerial Monitoring Committee in St. Petersburg, July 24, 2017

The Russian energy minister says his country would consider extending a deal with OPEC to cut oil output further into next year if supplies continue to glut the market and keep prices down.

“If we see that the market is imbalanced, we will consider an extension,” Aleksandr Novak told reporters on September 5 on the sidelines of a forum in the Far East city of Vladivostok.

“We will take such a decision if [it is determined that an extension is] needed,” he said.

Oil prices edged higher after Novak’s comments, along with similar remarks made earlier by Iranian energy officials.

Russia, Kazakhstan, Azerbaijan, and several other producers outside OPEC joined Saudi Arabia, Iran, Iraq, and other cartel members in a November 2015 agreement to cut global production in an effort to boost lagging prices.

After initial success, oil prices have fallen below $50 a barrel in recent months, hit by concerns of higher production in the United States, which was not part of the deal, and ramped-up output from other countries.

The current deal to cut supply runs through March 2018.

Following a July 24 meeting, Novak said that "some countries are not yet fully implementing" the production cuts, aimed at reducing total output by 1.8 million barrels a day.