Saudi Minister of Energy, Industry and Mineral Resources Khalid Al-Falih said on Sunday that OPEC and non-OPEC oil producers were complying with their pledge to lower oil output and that global oil inventories could be taken back to their five-year average by mid-year with full compliance. "There is no reason for us to suddenly come into January and say we need a bigger reduction or a longer period. Will this change in the second quarter? Possible, but (that's) improbable today," he told reporters ahead of the first meeting of a committee that will monitor compliance with the deal. Energy ministers from OPEC and non-OPEC countries meeting in Vienna have struck a positive note regarding their agreement to cut oil output as a committee set to monitor compliance with the deal meets for the first time. "I am satisfied, I am optimistic and, as I said, the markets are on their way to rebalance and it's happening," Al-Falih said. Compliance with the agreement, which calls for cuts to begin this month, had been "fantastic", he said. Kuwaiti oil minister Essam Al-Marzouq, who chairs the five-member compliance committee, said it would examine how to best monitor compliance and what level of compliance would be acceptable. The other members of the committee represent Algeria, Venezuela, Russia and Oman. A deal reached on Dec. 10 between members of the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC producers marked the first such pact since 2001. Under it, producers will lower output by nearly 1.8mn barrels per day (bpd) aiming to ease a global glut that has weighed on oil prices for more than two years. "Usually non-OPEC would raise their production to compensate for voluntary cuts by OPEC. Now, we are seeing voluntary cuts by both sides," Al-Falih said. Some 1.5mn bpd in crude production had already been taken out of the market, he said last week. — Agencies
