LONDON (Reuters) – Oil prices fell to less than $ 78 a barrel on Friday, as OPEC and Russia considered reducing supply barriers to compensate for disruptions in Venezuela and an expected fall in Iranian exports .
Russian Energy Minister Alexander Novak held talks with Saudi Energy Minister Khalid al-Falih on the flexibilization of the terms of the global pact of oil supply that has been in effect for 17 months, Novak said Friday.
The energy ministers of Saudi Arabia, Russia and the United Arab Emirates are discussing an increase in production of around 1 million barrels per day (bpd), the sources told Reuters.
Speaking in St. Petersburg, Falih told Reuters that "all options are on the table" when asked about the objectives of the production cuts.
Brent LCOc1 crude futures fell 80 cents to $ 77.99 a barrel at 0914 GMT, reaching its highest level since late 2014 at $ 80.50 this month.
U.S. West Texas Intermediate (WTI) crude futures were at $ 70.18 per barrel, down 53 cents.
"The debate on a possible easing of production restrictions should prevent any renewed increase in prices," said Commerzbank badysts.
"The $ 80 mark is likely to pose an obstacle that is difficult to overcome because it would significantly increase the likelihood of an increase in production."
The Organization of Petroleum Exporting Countries (OPEC), as well as a group of non-OPEC producers led by Russia, began to retain production in 2017 to adjust the market and prop up prices.
World crude supplies have been tightly adjusted last year due to OPEC-led cuts, which were driven by a dramatic drop in Venezuelan production.
Prospects for new sanctions on Iran after US President Donald Trump pulled out of an international nuclear deal with Tehran have also boosted prices in recent weeks.
As a result, compliance with the agreement to reduce production by 1.8 million bpd by the end of 2018 has been 152 percent, according to sources.
Amrita Sen, chief oil badyst at Energy Aspects consultancy, said: "Addressing non-compliance was always likely on the agenda in the midst of a tight market and low inventories, but the volume to recover is still to be debated."  HIGHER PRICES AT ONE COST
While Russia and OPEC benefit from oil prices, almost 20 percent since the end of last year, their voluntary production cuts have opened the door for other producers to increase production and gain market share.
U.S. Crude oil production C-OUT-T-EIA has increased more than a quarter in the last two years, to 10.73 million bpd. Only Russia produces more, at around 11 million bpd.
Production from countries such as the United States, Canada and Brazil, which are not subject to the OPEC / Russia-led agreement, is likely to continue to rise as oil prices rise.
Additional report by Henning Gloystein and Roslan Khasawneh; Edition by David Goodman