OPEC+ agrees to extend voluntary production cuts of 2.2 million BPD until the end of 2025, with gradual easing starting in October 2024.
The decision aims to stabilize crude prices and balance market demands, reflecting Saudi Arabia’s efforts to reconcile diverse member interests.
Weak demand concerns in China and other major economies, coupled with record U.S. oil output, have contributed to falling oil prices despite OPEC+ cuts and Middle Eastern tensions.
Brent crude was trading down well over 3% on Monday, marking the first time the global benchmark has been below $80 since February, with the U.S. crude benchmark down over 3.5% following the OPEC+ agreement to start phasing out voluntary cuts in October.
Oil prices fell more than $1 on Tuesday, extending losses from a four-month low in the previous session, as investors worried about supply rising later in the year amid signs of weakening U.S. demand.
Saudi Aramco’s $12 billion share sale sold out shortly after the deal opened on Sunday, in a boon to Saudi Arabia’s government as it seeks funds to help pay for a massive economic transformation plan.
The Organisation of the Petroleum Exporting Countries and its allies (OPEC+) agreed on Sunday to extend their voluntary production cuts of 2.2 million barrels of crude oil per day into 2025.
The oil-producing Organization of the Petroleum Exporting Countries and its allies could extend existing output cuts this week, delegates and analysts tell CNBC, even as focus shifts from Middle East tensions to summer demand.
Four OPEC+ delegates, who spoke anonymously because of the sensitivity of talks, told CNBC the 2.2 million-barrels-per-day supply reductions will likely be prolonged, with one noting that the alliance would avoid shifting approach at a time when oil prices are relatively stable.
Global physical crude oil markets are weakening because of soft refinery demand and ample supply, traders and analysts told Reuters, in a move that could spell further weakness for benchmark crude futures.
President Vladimir Putin said on Monday that Russian gas output rose by 8% in the first four months of the year to 246.4 bcm.
In its latest short term energy outlook (STEO), the U.S. Energy Information Administration (EIA) highlighted that, based on its estimates, “OPEC+ producers have largely adhered to the latest round of OPEC+ voluntary production cuts”.
– Oil wiped out an earlier sharp jump as Iranian media appeared to downplay the impact of Israeli strikes that followed last weekend’s unprecedented bombardment by Tehran.