OPEC+ countries extend voluntary oil output cuts by 2.2 mbp for Q3

  01 July 2024    Read: 659
OPEC+ countries extend voluntary oil output cuts by 2.2 mbp for Q3

A number of countries participating in the OPEC+ agreement will continue voluntarily reducing oil production by 2.2 mln barrels per day in Q3 as the alliance has been sticking to those policies aimed at balancing the oil market since the beginning of 2024, AzVision.az reports citing TASS. 

Initially, eight OPEC+ nations, including Russia and Saudi Arabia, agreed on additional voluntary output cuts for Q1 only. Later the measure was extended to Q2. At the latest OPEC+ ministerial meeting held on June 2 it was decided to extend it for Q3 as well.

Saudi Arabia additionally reduces oil production by 1 mln barrels per day, Iraq - by 220,000 barrels per day, the UAE - by 163,000 barrels per day, Kuwait - by 135,000 barrels per day, Kazakhstan - by 82,000 barrels per day, Algeria - by 51,000 barrels per day, Oman - by 42,000 barrels per day.

According to schedule on OPEC’s website, Russia will additionally reduce oil output by 471,000 barrels per day in Q3. That said, in Q1 Moscow reduced supplies to global markets by 500,000 barrels per day, not production. In Q2 both export and production were cut, with reductions averaging 471,000 barrels per day during the three months.

Meanwhile the Russian Energy Ministry said earlier that the country’s oil output was slightly higher in April and May due to technical difficulties of production cuts. However, the issue of overproduction was to be solved in June. Apart from Russia, Iraq and Kazakhstan posted the level of oil production above the OPEC+ agreements. Those three countries were to present a plan to compensate for outstanding overproduced volumes to the OPEC secretariat.

So far policies on oil production cuts by 2.2 mln barrels per day will remain in force until the end of September. Starting October, OPEC+ nations have agreed to start a gradual recovery of cuts that will last until October 2025. Moreover, those countries assumed the obligation to slash production by another 1.66 mln barrels per day from last spring until this year.



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