Gulf producers said to cut oil output 4%

Saudi Arabia and its OPEC allies in the Arabian Gulf have offered Russia to cut their oil output 4% from peak production, news agencies reported on Thursday.

Citing anonymous sources, Reuters said that Gulf energy ministers made the offer to their Russian counterpart, Alexander Novak, this week, ahead of a key meeting in Vienna on October 28-29 where OPEC and non-OPEC producers will seek to bridge the gap over how much each country should cut in order to bring oil prices up.

Last Sunday, OPEC’s second-largest producer Iraq, which is fighting a vicious war against ISIS, appeared to sabotage the agreement by insisting that it should be exempt from production cuts alongside other countries where output has been decimated by violence or sanctions, such as Libya, Nigeria and Iran.

As negotiations have drawn out in recent weeks, analysts have expressed fears that even if a deal is reached, it might not be implemented properly.

Russia, which touted a spare production capacity of some 4 million bopd last week, has reportedly been seeking to negotiate a freeze rather than a production cut with OPEC counterparts.