Saudi to cut oil exports by 500,000 barrels per day in December

Saudi energy minister lands in Baghdad to discuss reducing oil production

US crude has lost 28 percent since its early October peak. The sanctions affect the sale of Iranian oil and companies around the world that buy Iranian oil. WTI dropped 0.04 US dollar to settle at 63.1 dollars a barrel, while Brent was up 0.34 dollar to close at 73.17 dollars a barrel.

An official from group member Kuwait said on Monday major oil exporters had over the weekend "discussed a proposal for some kind of cut in (crude) supply next year", although the official did not provide any detail. "The exemptions have even surprised Saudi Arabia as oil supplies from Iran are likely to spike in the coming days", he added.

Oil producers will continue to evaluate the market data prior to the Vienna summit, "but if we need to trim production by one million bpd, we will do", Falih added.

On Thursday, the United States granted Iraq a 45-day exemption from sanctions which it reimposed on Iran. The softer-than-expected approach prevented sanctions from knocking too many Iranian barrels offline.

"The size of any potential cut will depend on how much oil demand growth slows down, how much Iranian supply falls due to United States sanctions, and how fast USA supply rises", said Giovanni Staunovo, an analyst at UBS. This was announced by the Minister of energy of Saudi Arabia Khalid al-falih following the meeting of the Ministerial monitoring Committee of OPEC+.

USA energy firms last week added 12 oil rigs in the week to November 9 looking for new reserves, bringing the total count to 886, the highest level since March 2015, Baker Hughes energy services firm said on Friday. WTI dropped 0.54 dollar to settle at 61.67 dollars a barrel, and Brent was down 0.06 dollar to close at 72.07 dollars a barrel.

He also attributed the sharp drop in prices to "microeconomic uncertainties" and signs of a build-up in crude inventories. The global benchmark crude traded at a US$10.04 premium to WTI for the same month.

USA crude oil imports averaged 7.5 million barrels per day in the week, up by 195,000 barrels per day from the previous week. As of 12:18 p.m. EST, more than 668 million USA futures contracts had traded, far exceeding the full-day average of 583 million contracts. At the same time, the Associated Press reports, discussions have started with Russian Federation to curb the global supply of crude seeing as Iran sanctions failed to lift prices.

A big concern for Saudi Arabia and other traditional producers from the Middle East dominated Organization of the Petroleum Exporting Countries (OPEC) is the surge in U.S. output. OPEC and the IEA (International Energy Agency) are releasing their updates to the oil market this week and the outlook for 2019 was already on the weak side. Turn about: Opec members and its 10 allies are mainly anxious about the increasing USA production (11.4 million barrels a day).

They agreed that output increases by producers other than Iran would lead to a glut next year. They worry that a continued fall in crude oil price will cause a 2014-16 style oil crash when oil price dropped 70%, in large part due to the U.S. shale oil boom.

Thus, midstream companies such as Plains All American could be a safer bet on the US oil boom.

"Twelve days in a row is insane - but there are a lot of pieces putting pressure on the market", said Bob Yawger, director of energy futures at Mizuho.

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