ST PETERSBURG, Russia (Reuters) - OPEC oil producers could be wasting their efforts by cutting output as rising U.S. production threatens to deliver a wave of new supply next year, Igor Sechin, the head of Russian oil company Rosneft, said on Friday.
The Organization of the Petroleum Exporting Countries, which accounts for around a third of global oil output, and 11 other producers led by Russia have agreed to cut oil production by 1.8 million barrels per day to prop up weak prices.
Sechin, one of the closest allies of Russian President Vladimir Putin, long opposed the idea of Russia joining cuts but reluctantly agreed to do it after the Russian government decided to move in tandem with OPEC.
On Friday Sechin again questioned the efficiency of cuts which were extended last week until March 2018, by saying oil producers were losing market share to U.S. firms which are not part of the deal.
He also slammed the OPEC and non-OPEC agreement, saying it only gives the market a temporary respite.
“Those are hardly systemic measures,” Sechin told the St Petersburg International Economic Forum attended by global energy executives and officials, including Saudi Energy Minister Khalid al-Falih.
Sechin said that oil producers in the United States could add up to 1.5 million barrels per day to world oil output next year.
“Consequently, lower oil output from the OPEC and non-OPEC agreement could be considerably offset by as early as mid-2018, by U.S. shale oil production growth,” he said.
He said Russia is also capable of increasing its oil production.
Reporting by Dmitry Zhdannikov and Olesya Astakhova; editing by Jason Neely