Source: Saudi Arabia, Russia, OPEC+ still in contact, mull options

MOSCOW, Jul 6 (PRIME) -- The OPEC management, Saudi Arabia and Russia were in contact with the OPEC+ alliance late on Monday, different options are on the table, a source in one of the delegations told PRIME on Tuesday, a day after the OPEC+ alliance failed to agree on the deal and, the meeting of ministers was cancelled.

“Informal negotiations happen every day, the process has not stopped. Yesterday night, the OPEC management and the key market players – Russia and Saudi Arabia – had contacts with the members of the deal, they are working on different options,” the source said.

“Speaking of another meeting, members of the agreement stand for resumption of discussions as soon as possible, and it is very likely to happen at the end of the week. I think that consensus will be reached. It is a common market and the problems are common as well, we have to solve them.”

The United Arab Emirates’ (UAE) leaving the deal is out of the question, and the cartel is seeking a solution. Negotiations are tough, but the dispute is solvable, the source added.

The OPEC+ countries agreed to reduce their oil output by 9.7 million barrels per day in May 2020 to fight the consequences of the global coronavirus pandemic, with Russia’s share of 2.5 million barrels per day. The cut was narrowed to 7.7 million barrels per day for August–December 2020, and then to 5.8 million barrels per day.

Prior to the latest meeting of the cartel, the Joint Ministerial Monitoring Committee recommended that the alliance continue increasing production in August–December by 400,000 barrels per day each month and prolong the deal until the end of 2022 from the end of April 2022. But the UAE was against approving the prolongation nine months before the deadline, and wanted to revise the country’s baseline production level, effectively increasing its quota by almost 700,000 barrels per day to 3.8 million barrels.

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