(CTN News) – There is no need for OPEC and the broader OPEC+ group to propose a change to their current oil production policy when they meet next week, commodity analyst Giovanni Staunovo reported on Monday.
It was announced this week that members have agreed to reduce production by 2.2 million barrels per day (bpd) this quarter, although most of these reductions were already in place, including Saudi Arabia’s voluntary reduction of 1 million barrels per day.
OPEC+ alliance members that pledged Q1 supply reductions announced in early March that they would roll them over to Q2.
OPEC+ members include Saudi Arabia, Iraq, The United Arab Emirates, Kuwait, Kazakhstan, Algeria, Oman, and Russia that have agreed to reduce their crude oil production and exports in the first half of 2024 through additional voluntary reductions, in addition to the voluntary cuts that OPEC+ announced in April 2023 and later extended into 2024.
As the OPEC+ members announced on March 3 their intention to extend the cuts into the second quarter, Russia revised its production/export cut plan and announced that it would reduce supply in the second quarter by 471,000 bpd by cutting production and exports. As of April 1, Russia will reduce production by 350,000 barrels per day and exports by 121,000 barrels per day.
There will be a 400,000-bpd reduction in production in May and 71,000 bpd reduction in exports in June, with the Russian supply cut resulting entirely from reductions in production in May.
As indicated by the production estimates for February, some members – particularly Iraq and Kazakhstan – continued to overproduce.
It was announced in mid-February that both Iraq and Kazakhstan would comply with the cuts they had pledged.
OPEC’s second-largest producer, Iraq, has committed to its voluntary contribution to the agreement to produce no more than four million barrels per day, Iraq’s Oil Minister Hayan Abdel-Ghani said in February.
The non-OPEC oil producer Kazakhstan, for its part, promised to make up for January’s non-compliance with the cuts.
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