Saudi Arabia 'revisiting' policy on oil output cuts, India says

NEW DELHI: Indian Oil Minister Dharmendra Pradhan said on Wednesday Saudi Arabia and other OPEC producers are “revisiting” their output-cutting policy, referring to a discussion he had with his Saudi Arabian counterpart.

“For the first time, the Saudi Arabian oil minister called us and said ‘we are revisiting our policy on oil output cuts’,” Pradhan said.

This follows news on Tuesday that the US government had unofficially asked Saudi Arabia and some other OPEC producers to raise oil output.

OPEC and non-member producers led by Russia had agreed to curb output by about 1.8 million barrels per day until the end of 2018 to reduce global stocks, but the inventory overhang is now near OPEC’s target.

Ministers from the Organization of the Petroleum Exporting Countries and other participants in the output agreement meet in Vienna on June 22-23 to decide policy.

Oil prices hit a 3-1/2-year high of $80 per barrel in mid-May on concerns about a possible supply shortage fuelled by new U.S. sanctions against OPEC member Iran.

Read More: India says has Saudi assurances on oil supply

Around the same time, when India had expressed frustration over rising oil prices, Saudi Energy Minister Khalid al-Falih told Pradhan that supporting global economic growth was one of the Gulf nation’s key goals.

India imports almost 80 percent of the crude it consumes.

Pradhan, talking to reporters in New Delhi on Wednesday, said India was awaiting clarity on the impact of US sanctions on Iranian crude exports.