An OPEC+ ministerial panel met on Friday without changing the status quo on oil production. The extension of Saudi Arabia’s voluntary production cut until September helped oil prices to rise.
Oil prices rise following extension of OPEC production cut++ Oil prices rise following extension of OPEC production cut++ Oil prices rise following extension of OPEC production cut++ Oil prices rise following extension of OPEC production cut
The panel, known as the Joint Ministerial Monitoring Committee, can convene a full meeting of the Organization of the Petroleum Exporting Countries (OPEC) and its Russian-led allies, known as OPEC+, if necessary. Oil prices rose by over 14% in July compared with June, the biggest monthly increase since January 2022. Growing demand and tighter supply outweighing concerns about interest rate rises and persistent inflation could affect economic growth.
“The committee will continue to closely assess market conditions,” says an OPEC statement issued after the online meeting, adding that the panel urged members to fully meet their production cut commitments.
On Thursday, Saudi Arabia extended its voluntary production cut of 1 million barrels to September by a further month. This measure could be extended or reinforced. On Friday, oil prices reached $86 a barrel, close to their highest level since mid-April.
Russia joins OPEC+ reduction as group maintains status quo
Following the Saudi announcement, Deputy Prime Minister Alexander Novak confirmed the Russian reduction of 300,000 barrels per day in September. As for Algeria, it has not yet decided whether it will extend the 20,000-barrel-per-day reduction in September.
At the June meeting, OPEC+ reached a global agreement to limit supply until 2024. Saudi Arabia voluntarily reduced its production in July and extended it in August.
The group reduced its production by 3.66 million barrels per day, or 3.6% of global demand.
The next JMMC meeting will be held on October 4. Reported by Ahmad Ghaddar and Alex Lawler in London, Maha El Dahan in Dubai and Olesya Astakhova in Moscow. Additional report from Lamine Chikli in Algiers. Edited by Kirsten Donovan.
