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Algeria, which was instrumental in crafting OPEC's historic output deal a year ago, has reduced production by 55,000 bpd, according to Boutarfa, who sees oil field maintenance in May and June curbing its output by a further 15%. Market watchers expect the group to extend cuts until the end of March 2018.

Opec is widely expected to prolong its supply curbs, and all producers are backing a nine-month extension, Saudi Arabia Oil Minister Khalid Al-Falih said today.

Saudi and Russian Federation produce a combined 20 million barrels of crude oil a day - about one-fifth of global consumption - and other oil-producing nations are expected to follow their lead over cuts, the BBC reported. "We support this proposal".

Brent crude futures, the worldwide benchmark for oil prices, have been marked down recently due to slower than anticipated growth in global demand.

Organisation of the Petroleum Exporting Countries (OPEC), continued to reduce production in April, but output from Africa's top exporter - Nigeria, increased by 273,600 barrels per day (bpd). The US EIA data showed that crude stockpiles fell 1.8 million barrels against expectations of a fall of 2.4 million barrels for the week ended May 12.

Following the Russia-Saudi statement, Kazakh Energy Minister Kanat Bozumbayev said "Kazakhstan should follow the trend", in comments reported by Russia's RIA Novosti agency.

"In terms of delivering an initial boost to the price, the production cuts were successful", said Ganguli.

Oil prices vaulted on Wednesday after data showed a decline in US stockpiles as refineries hiked output.

Overall, crude imports from Saudi Arabia rose the highest at 42 per cent to 1.38 million b/d from 970,000 b/d.

One source said a deeper cut in output was an option depending on estimated growth in supply from non-OPEC producers, mainly United States shale oil firms, among other scenarios.

In a note, Bank of America Merrill Lynch said the time it takes production cuts to impact on stocks was one of the major challenges for OPEC. Non-OPEC oil supply in 2016 is estimated to have averaged 57.30 mbpd, representing a decline of 0.71 mbpd over the previous year, and a downward revision of 0.02 mbpd from the last assessment.

Although the storage trade has been less profitable since the OPEC production cuts, much of that oil remains in tanks, said Chris Bake, an executive committee member at Vitol, the world's largest independent trader, during an industry conference last week in London.


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