OPEC Discussed Deepening Cuts

OPEC discussed cutting its oil output by a further 1-1.5% when it met last month, three sources familiar with the matter said, and could revisit the proposal should inventories remain high and continue to weigh on prices. The Organization of Petroleum Exporting Countries and non-member producers ultimately decided at the May 25 meeting to extend their existing supply-cutting agreement for nine months, although oil ministers including Saudi Arabia's Khalid al-Falih confirmed deeper curbs had been debated, Reuters reported. One of the sources said the idea floated was to widen OPEC's supply cut by about 300,000 barrels per day. That would equate to a further curb of about 1% of April output of nearly 32 million bpd and bring OPEC's total pledged cut to 1.5 million bpd, from 1.2 million bpd. "They wanted to do some scenarios and get around 300,000 bpd of extra cuts to be distributed among everyone," the source, who declined to be identified, said. "But I think they decided to wait and see how the market will react first."