Kingdom pushed for production cuts last year
Saudi Arabia is targeting oil prices to rise to around $60 a barrel this year, according to a report by news agency Reuters.
The $60 price is the level which Riyadh is comfortable with to drive investment back into the energy sector as well as boosting the valuation of state oil major Saudi Aramco for its planned listing in 2018.
Opec, led by Saudi Arabia, agreed to production cuts to lower output by 1.2 million barrels a day (b/d) for six months starting in January to help boost prices.
In 2014, Saudi Arabia led Opec to agree on a pump-at-will policy as oil prices dropped. The aim was to hold on to market share and edge out higher-cost shale oil producers. It has since last year reversed its policy and has undertaken significant production cuts since the start of 2017.
The oil producer reduced output by 70,000 b/d more than its agreed share of 490,000 b/d in January.
Opec has managed to achieve more than 90 per cent compliance after two months of production cuts. Latest figures by Opec show that production from the 13-state exporter group dropped 890,200 b/d between December 2016 and January 2017.
Saudi oil minister Khalid al-Falih had earlier said that an extension of production cuts was unlikely. However, the sources cited by Reuters added that a further extension was possible to bring prices to Saudi Arabias desired level.
Opec, has long denied that it functions as a cartel, targeting specific oil prices. Oil ministers of Gulf producers that are part of the exporters group have said the focus was more on re-balancing the market.
Opec producers are set to meet in in Kuwait - which heads the Opec monitoring committee - on 25 and 26 March, according to international media reports.