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EDITOR IN CHIEF- ABDULLAH BIN SALIM AL SHUEILI

Oil skids 5pc after extension of output cuts

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VIENNA: Opec and non-members led by Russia decided on Thursday to extend cuts in oil output by nine months to March 2018 as they battle a global glut of crude after seeing prices halve and revenues drop sharply in the past three years.


Oil’s earlier price decline, which started in 2014, forced Russia and Saudi Arabia to tighten their belts and led to unrest in some producing countries including Venezuela and Nigeria. The price rise this year has spurred growth in the US shale industry, which is not participating in the output deal, thus slowing the market’s rebalancing with global crude stocks still near record highs.


Oil prices fell nearly 5 per cent on Thursday as the decision to extend production curbs fell short of expectations of deeper or longer cuts.


Oil producers agreed to extend a cut in oil supplies of 1.8 million barrels per day (bpd) until March to reduce a glut of supply. Brent crude oil was down $2.38 a barrel at $51.58 a barrel by 12:15 pm (1615 GMT).


US West Texas intermediate crude futures fell $2.43 a barrel to $48.93, a 4.8 per cent drop, breaking through $50 for the first time all week as volumes rose sharply.


Dubai Mercantile Exchange (DME) said that Oman oil price (July delivery 2017) reached $52.90. The price of Oman oil declined 34 cents from the price of Wednesday, which was $53.24. — Agencies


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