Source: OPEC+ mulls prolongation of existing conditions

MOSCOW, Nov 5 (PRIME) -- OPEC+ is considering prolongation of the current reduction quotas instead of an initially planned increase of 1.9 million barrels per day on January 1, 2021, a source in one of the alliance’s delegations told PRIME on November 4.

The Wall Street Journal reported on November 3 quoting sources that Saudi Arabia and other OPEC members were discussing deeper production cuts as the coronavirus situation worsens.

But the source told PRIME that the majority of OPEC+ states think that now is not the time for a deeper reduction, although that there was no consensus. “The situation is not like the media reports it to be. The situation now is that we are not considering an additional reduction, but we are mulling not raising production at the beginning of next year like we’ve planned before,” the source said.

“Judging by the discussions, there is an inclination that the current situation is not favorable for an additional contraction due to the pandemic and other geopolitical cataclysms. All members of the process state that the market is unstable and its condition is dissatisfying. Many issues will be discussed at the upcoming meeting.”

Russian Deputy Energy Minister Pavel Sorokin said on Monday that Russia’s official position on the future of the OPEC+ deal had not been formulated yet, and would be available for the public after the next meeting of the OPEC+ monitoring committee on November 17.

The OPEC+ countries agreed to reduce their oil output by significant 9.7 million barrels per day in May to fight the consequences of the global coronavirus crisis, with Russia’s share of 2.5 million barrels per day. Later, the cut was prolonged at 9.7 million barrels per day for July, and narrowed to 7.7 million barrels per day for August–December, and then to 5.8 million barrels per day until May 2022. The agreement is valid until April 30, 2022, but the members will revise its extension in December 2021.

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