QNA & Agencies
Riyadh
Eight OPEC+ countries have agreed to implement an adjustment in oil production of 411,000 barrels per dayfor May.
This production increase is equivalent to three monthly increments, including the increment originally planned for May, as well as two additional increments.
These increases are subject to adjustment or temporary suspension depending on market variables, to ensure continued support for oil market stability.
This came during an online meeting held today by Saudi Arabia, Russia, Iraq, the UAE, Kuwait, Kazakhstan, Algeria, and Oman to monitor developments in the global market and review their conditions.
“This measure will provide an opportunity for the participating countries to accelerate their compensation”,OPEC said.
The countries also renewed their commitment to the voluntary adjustments agreed upon at the 53rd meeting of the Joint Ministerial Monitoring Committee (JMMC), held on April 3.
They affirmed their intention to fully compensate for the excess production since January 2024 and to submit updated and accelerated compensation plans to the OPEC Secretariat by the 15th of this month. The eight countries will hold monthly meetings to monitor market developments, compliance rates, and theimplementation of compensation plans. A meeting will be held on May 5th to determine production levels for June.
The OPEC Plus alliance comprises 23 countries, including the 13 OPEC members, along with 10 other producing countries.
The increase will reduce fears arising from any disruption to Iranain supply as Trump restores maximum pressure on Tehran, also an OPEC member. The US President, who has called on OPEC to lower prices since starting his second term, may visit Saudi Arabia as soon as next month.
The May hike is the next increment of a plan agreed by Russia, Saudi Arabia, UAE, Kuwait, Iraq, Algeria, Kazakhstan and Oman to gradually unwind their most recent output cut of 2.2 million bpd, which came into effect this month.
OPEC+ also has 3.65 million bpd of other output cuts in place until the end of next year to support the market. The total of 5.85 million bpd is equal to about 5.7 percent of global supply.
The decision on Thursday partly reflects OPEC+ leaders’ wish to improve compliance with production quotas, analysts said.
