Iran Press/ Europe: The oil and energy ministers of OPEC+ met today (Thursday, March 31) while global energy markets keep an eye on the coalition’s decision as oil prices continue rising.
Since the start of the Russian military offensive against Ukraine on February 24 and the imposition of Western sanctions on Moscow, which have limited Russian oil exports, OPEC+ has come under increasing pressure to enhance its crude oil output.
But the coalition’s decision at its 19th meeting in July to change the production baselines for the five countries of Kuwait, Iraq, the UAE, Saudi Arabia, and Russia to a total of 1.6 million barrels per day from May 2022 may reduce the growing pressure on OPEC+ to some extent.
The share of Russia, Saudi Arabia, the UAE, Iraq, and Kuwait in changing the baseline is 500,000 barrels, 500,000 barrels, 332,000 barrels, 150,000 barrels, and 150,000 barrels per day, respectively. But can Russia increase its baseline under sanctions? We have to wait and see.
Read also:
OPEC Plus ready to supply fuel needed by consumers: Iran's oil minister
Russia-Ukraine military clashes in late February pushed oil prices up to $140 in March, a price that has been unprecedented since 2008 but has since fallen to around $110 per barrel.
At its 26th meeting on March 2, 2022, the OPEC+ coalition did not react to the military conflict between Russia and Ukraine. Saudi Arabia and the United Arab Emirates have recently announced that the group is only interested in stabilizing the market and will not enter politics.
An analysis of analysts' views ahead of the meeting suggests that the OPEC+ coalition should adhere to a gradual increase by adding 400,000 barrels per day every month.
OPEC+ agrees to boost output by 432,000 bpd in May
At their 19th meeting in July, OPEC and its allies agreed to increase production by a total of 400,000 barrels per day each month to end the supply limit of 5.8 million barrels per day, a decision that has been in place since August.
In response to the demand collapse at the height of the Covid-19 outbreak, OPEC+ had cut production by 9.7 million barrels per day in May 2020, equivalent to about 10 percent of global demand, but since then, it has eased supply constraints over time.
The members of this coalition decided to hold the 28th OPEC and Non-OPEC Ministerial Meeting on May 5.
Since August, OPEC and its allies have been adding 400,000 barrels per day to production to end the 2020 supply limit.
In response to the collapse in demand at the height of the Covid-19 outbreak, OPEC+ cut production by 9.7 million barrels per day in May 2020, equivalent to about 10 percent of global demand, but has since facilitated supply constraints.
206
Read More:
OPEC: Iranian heavy crude oil price increase by about 11 percent
