Vienna — OPEC rivals Saudi Arabia, Iran and Iraq on Wednesday signaled their willingness to compromise on an output deal, but did not offer any specific details, as any individual country production cuts are still being negotiated.
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"We have agreed on a cut but have not defined the numbers," Iraqi oil minister Jabbar al-Luaibi said in an OPEC press briefing. "We have not agreed on figures, we have agreed on principle only and we will discuss the figures."
Saudi energy minister Khalid al-Falih told reporters that he would find it acceptable for Iran to produce at pre-sanctions levels, a condition that Iran had insisted on before signing on to any deal.
Falih said he was receptive to one proposal to cut OPEC's collective production to 32.5 million b/d, excluding volume fluctuations from Libya and Nigeria. Iran too has "been offered to freeze at pre-sanctions levels."
"It will mean that we take a cut and a hit from our current production and from our forecasts for 2017. We will not do it unless we make sure that there is consensus and an agreement to meet all the principles I just mentioned," he said.
Rolling over with no deal would not be a bad outcome to the meeting either, Falih said given the slowdown in non-OPEC production growth. "It will accelerate more with an OPEC, non-OPEC agreement, but it is not imperative," he said.
Iranian minister Bijan Zangeneh said his country was "ready to compromise" on a deal, and he agreed that any production policy should be based on secondary sources, an issue Falih would not deal with directly to reporters.
Luaibi, who had protested the use of secondary sources and, like Iran, had been resistant to cutting production, said his country was ready to reduce output under an OPEC deal.
"Iraq is in line with OPEC policy providing our interests are safeguarded," Luaibi said at the press briefing, adding that he was targeting an oil price of at least $55/b. "We are ready to cut within the framework of the country's interests."
The comity comes after negotiations earlier in the week had turned contentious, with sources saying that geopolitics had made any consensus difficult.
Ministers are aiming to finalize the output deal at their formal meeting, which began after the press briefing.
Ministers were in agreement that non-OPEC contributions would be vital to any deal to rebalance the market, targeting a 600,000 b/d cut from them.
"I hope we can reach an agreement. I believe that we are very close and we need contributions from the non-OPEC side to complete our decision and to maintain and restabilize the market situation," Zanganeh told reporters, adding that he expected Russia to agree to cut its output after OPEC finalizes its deal.
Russia has indicated that it would prefer to freeze production at record highs of 11.2 million b/d, rather than cut.
"Freezing at an all time high is not a match to what OPEC is doing," Falih said. "So our discussion with Russia has been around a cut from non OPEC countries and I'll leave it up to them to offer that."
Zanganeh said a six-month output agreement "can be the first stage of any deal and we can roll [it] over, based on the reactions of the market."
Saudi Arabia, however, has offered a longer timeframe, with Falih saying "it will take all of 2017 to get to where we want," but adding that "the parameters may change."
OPEC is trying to clinch what would be its first coordinated cut since 2008 to help accelerate the market's rebalancing.
The producer group announced a preliminary deal in Algiers in late September that set an output ceiling of between 32.5 million and 33 million b/d, which would require a cut of between 640,000 to 1.14 million b/d from its October levels, according to OPEC's own estimate.
Since then, several rounds of technical meetings and minister-to-minister negotiations have failed to resolve deadlocks over individual country allocations, exemption requests, and the production figures that would be used to monitor and enforce the deal.
--Staff reports, email@example.com