OPEC+ is about to reach an agreement on production quotas

The OPEC+ alliance is close to reaching a settlement with producers over next year’s output levels after disagreements over output targets forced the alliance to postpone a key meeting scheduled for Sunday.

Officials said Angola and Nigeria, members of the Organization of Petroleum Producing Countries (OPEC),OPEC– Their goal is to increase their share of oil production.

The postponement of the OPEC+ meeting (which includes OPEC and other allies including Russia) from November 26 to 30 caused a sharp decline in oil prices.

An unnamed source told Reuters he was “99% confident that the OPEC+ alliance could reach a deal on November 30”.

Two other sources said a deal was close, and a fourth said discussions were continuing.

Gabriel Tanim Adada, Nigeria’s representative to OPEC, told Reuters on Thursday that he was not aware of any disagreements with other OPEC+ members over Nigeria’s production targets.

Many analysts said they expect OPEC+ to extend or increase oil production cuts next year to support oil prices.

The market is also waiting to see whether Saudi Arabia will extend an additional voluntary production cut of 1 million barrels per day and Russia’s additional voluntary production cut of 300,000 barrels per day. The production reduction plan will end at the end of December next year.

Notably, several countries, including Nigeria and Angola, changed their output targets at the last OPEC+ meeting last June after years of failing to meet previous targets.

This comes after the two countries accepted production quotas that reflected reduced production capacity in both countries due to a lack of investment and operational disruption, with Nigeria at 1.28 million bpd and Angola at 1.38 million bpd.

Oil drilling derrick in desert oil field. War-induced changes in oil prices. Oil prices are rising.
OPEC+ is estimated to be working to extend oil production cuts to support its market price (Shutterstock)

Oil prices fall

As of Friday’s close yesterday, oil prices fell as geopolitical risk premiums fell as a temporary truce was entered between Israel and Palestinian resistance groups. Gaza StripThat included a prisoner swap, but prices rose weekly for the first time in more than a month.

The Brent crude oil futures contract settled down 84 cents, or 1%, at $80.58 a barrel, while U.S. West Texas Intermediate crude fell $1.56, or 2%, from Wednesday’s closing price of $75.54.

On Thursday, due to the US Thanksgiving holiday, there was no settlement for West Texas Intermediate crude oil, and both contracts achieved their first weekly gains in five weeks.

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