Saudi Arabia's energy minister Khalid al-Falih adjusts his glasses during a news conference after a meeting of the Organization of the Petroleum Exporting Countries in Vienna, Austria, December 10, 2016. Photo: Reuters/Heinz-Peter Bader

OPEC and its allies agreed on Monday to press on with a collective cut in oil production through the month of June, citing enduring supplies from Iran and Venezuela despite US sanctions.

“The fact of the matter is that [Iran and Venezuela] have not declined precipitously – to the point where we see there are still inventory builds,” said Saudi Energy Minister Khalid al-Falih, in comments published by S&P Global.

Saudi Arabia, under the direction of Crown Prince Mohammed bin Salman, last year heeded an American request to ratchet up oil production ahead of renewed US sanctions against Iran’s petroleum sector. Those went into effect on November 4, 2018, but Riyadh was caught off guard by the sudden announcement of eight waivers exempting key importers like China, India and Turkey.

In response, Saudi Arabia and Russia convened 24 OPEC and non-OPEC oil exporters to correct the glut. The consortium known as OPEC+ agreed in December last year to remove 1.2 million barrels per day from the global market in the first half of 2019.

Now, the US is targeting the Venezuelan oil sector with sanctions in an attempt to pressure the government of Nicolas Maduro and boost his rival Juan Guaido. The Venezuelan opposition in February appointed a new board for Citgo, the US-based subsidiary of the Venezuelan state oil company PDVSA.

But it was Maduro’s oil envoy who attended the latest OPEC+ meeting on Monday in Baku, where the cartel and its allies not only decided to extend production cuts through June, but also to cancel an April meeting that could have allowed further assessment.

Speaking in Baku, the Venezuelan oil minister said his country was looking to divert oil normally destined for the US to Russia instead.

While Saudi Arabia has often attracted the ire of US President Donald Trump over oil cuts and perceived efforts at price gauging, the American leader appeared to be preoccupied with domestic concerns on Monday

Survey: Has OPEC lost its ability to control the global oil market?

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