Oil prices: Iraq will co-operate to cut production in bid to prop up Brent crude

Jessica Morris
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Iraq Signs Contracts With Foreign Oil Companies
Oil prices are hovering around $35 per barrel (Source: Getty)

Iraq's oil minister has said his country would co-operate if Organization of the Petroleum Exporting Countries (Opec) and non-Opec members agree to cut crude production, in the wake of a supply glut that's sent oil as low as $27 per barrel this year.

It comes as one of Opec's poorer member, cash-strapped Venezuela, has called a meeting to discuss steps to prop up oil prices, which are currently hovering around $35 per barrel.

Speaking to reporters in Baghdad today, Adel Abdul Mahdi said: "Iraq will agree and co-operate if producers really want to co-operate to cut."

This week, speculation over whether the joint effort would come to fruition swirled around oil markets. However, subsequent comments made by Russian and Opec official poured cold water on this.

A top Iranian oil official also said that Iran wouldn't co-operate to cut oil production until its output returns to pre-sanctions levels, the WSJ reported. Meanwhile, Russian deputy prime minister, Arkady Dvorkovich, said that the state would not intervene to balance the market.

Nevertheless, analysts noted Russia's stance towards an agreement had softened. In the past, it's strongly opposed any co-operation with Opec to cut production.

"While we believe that it is too soon to say whether a policy change will actually materialise, we have seen some signs of softening in the Russian position this week that suggest that the economic realities of low prices are prompting a consideration of an exit ramp," RBC Capital markets said in a note.

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