OPEC supply cut only way to push up oil prices: Poll

A Dubai-based regional research firm said here on Sunday the Organisation of Petroleum Exporting Countries (OPEC) needs to cut production to sustain a rise in crude prices above $50 a barrel.

According to the GIQ Industry Survey, "it does not matter if the world's biggest oil producers agree to freeze output when they meet in Algiers later this week, because they must slash supply to support a protracted price rally," said the Gulf Intelligence in a statement.

This is the view of two-thirds of the 250 international energy executives operating across the Gulf who participated in the GIQ poll on September 22, and the results were released earlier on Sunday, Xinhua news agency reported.

OPEC, which pumps about one third of the world's oil supply, and non-OPEC producers are scheduled to meet on September 28 in Algeria in a bid to reach a deal to boost prices by limiting oil production.

"This is the right time for action as all stakeholders are ready," Falah Alamri, OPEC Governor in Iraq said in reaction to the survey results.

OPEC last reduced supply in 2008 when the global economic crisis crippled demand, Xinhua news agency added.

Meanwhile, 20 per cent of the survey respondents said crude oil prices will fall and test new cycle lows as they did earlier in 2016 if OPEC and its non-OPEC peers fail to agree to at least cap production at current levels.

"We have to do something as the lower price isn't acceptable to anybody, not for producers or consumers — even developed economies are hurting from this," said Alamri.

Brent crude futures declined nearly four per cent on Friday to close at $45.89 a barrel (159 lite), less than half the price two years ago.

Algeria on Sunday expressed optimism that an agreement could be reached by major oil producing countries to stabilise the world oil market, Xinhua news agency reported.

"I'm very optimistic that OPEC members would reach a consensual agreement to restore stability to the up-and-down oil market," Algerian Energy Minister Noureddine Bouterfa told a press conference in Algiers.

He noted that Saudi Arabia and Iran, the two influential members of OPEC, have been sending positive signals as they are likely to work on limiting their outputs in the short term, adding that talks are also underway with non-OPEC producers including Russia, to persuade them to freeze production.