Oil hits six-week high on hopes of extended OPEC cuts

New Saudi oil minister endorses production cuts

The OPEC petroleum exporters' cartel and key independent producers want to halt a slide in prices that has persisted despite previous output cuts and USA sanctions that have squeezed supply from Iran and Venezuela. -China trade war dents the outlook for consumption.

Separately, the U.S. Energy Information Administration said domestic gasoline stocks decreased less than expected last week while crude stocks fell to the lowest in almost a year.

Prince Abdulaziz bin Salman's remarks indicate he will likely continue a similar policy to that of his predecessor, Khalid al-Falih, who led the deal to cut global production among major oil producers.

He also waved off the International Energy Agency's projections that demand for oil was slowing.

The United States is "very concerned" about China's purchases of Iranian oil, Dan Brouillette, deputy secretary of the U.S. Department of Energy, said on Monday.

Prince Abdulaziz said: "It's all about the incremental contributions".

Until Prince Abdulaziz's appointment late on Saturday night, Saudi Arabia's oil ministry has been since 1960 headed by civilian technocrats.


Saudi's estimated oil export earnings fell from more than $800 million per day in April 2014 to less than $300 million per day in February 2016 in the slump that followed the end of the first shale oil boom.

In the most recent period, foreign reserves fell by a total of nearly $14 billion in June and July, as lower prices hit export earnings, after increasing by $32 billion over the previous 20 months. That said, Prince Abdulaziz is expected to face mounting pressure from Saudi royals in order to boost oil prices to help reduce current budget constraints and to also lift the value from the partial privatisation of Saudi Aramco, which plans to list 1% of Aramco this year.

Henderson says that includes megaprojects such as building a $500 billion futuristic city, called Neom, in a remote northwestern corner of Saudi Arabia. That's despite the fact that involuntary production slumps in Venezuela and Iran have failed to have any effect on prices while bringing OPEC's compliance with the cuts well above 100 percent.

Prince Abdulaziz bin Salman can be seen embracing his brother, Crown Prince Mohammed bin Salman, after giving his oath at the Red Sea port of Jedda.

All eyes are on the de-facto Opec leader, Saudi Arabia, as the country recently carried out a major reshuffling of executives in its oil industry. Riyadh will continue to back the OPEC+ coalition that combines Russian Federation and other producers with members the Organization of Petroleum Exporting Countries.

But the issue of uranium enrichment has been a sticking point with Washington, especially after Crown Prince Mohammed bin Salman said in 2018 that the Sunni Muslim kingdom would develop nuclear arms if regional rival Shi'ite Muslim Iran did.

RRPCL is a joint venture between Saudi Aramco, Abu Dhabi National Oil Company (Adnoc), and three state-run oil marketing companies (OMCs) - Indian Oil Corporation (IOCL), Hindustan Petroleum Corporation (HPCL) and Bharat Petroleum Corporation (BPCL).

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