Opep+ 2024: Reinforced Strategy to Stabilize the Oil Market

Faced with falling oil prices, OPEC+ has announced major production cuts for 2024, led by Saudi Arabia and Russia.

Share:

Opep+ 2024 Pétrole Coupes Marché

After a postponement due to disagreements, Opep+ has finally decided on further oil production cuts in 2024. This decision is intended to counter the recent fall in oil prices, a crucial issue for the global economy. Despite the absence of a comprehensive collective agreement, several member countries, notably Saudi Arabia and Russia, have taken significant steps to reduce their production.

Measures taken by Saudi Arabia and Russia

Saudi Arabia, a major player in the alliance, has announced the extension of its production cut by one million barrels a day until the end of the first quarter of 2024. At the same time, Russia decided to cut its exports of crude oil and petroleum products by 500,000 barrels a day. These measures reflect the desire of the alliance’s two largest producers to stabilize markets.

Market reactions and expert analysis

Markets reacted with some disappointment to the absence of a unified OPEC+ agreement, leading to a temporary 3% drop in US WTI. Jorge Leon, analyst at Rystad Energy, sees this as a mixed victory for Saudi Arabia, which only managed to convince seven members of the alliance.

Internal reluctance and discord

Angola and Nigeria, two African member countries, have shown reluctance, wishing to increase their quotas to boost their oil revenues. These disagreements underline the internal challenges within Opep+ and the divergence of interests between its members.

Opep+ strategy and new players

Since the pandemic, OPEC+ has alternated between increasing and reducing production, against a backdrop of economic uncertainty. Nevertheless, their strategy is struggling to stabilize prices over the long term. Brazil’s potential entry into the alliance in 2024 could redefine oil market dynamics.

Recent OPEC+ decisions reveal the complexities and internal tensions of the alliance, against the backdrop of a changing oil market. The future of the Opec+ production policy and its impact on the global economy remain subjects of major interest.

Petro-Victory Energy announces the completion of drilling operations for the AND-5 well in the Andorinha field, Brazil, with positive reservoir results and next steps for production.
The Colombian prosecutor’s office has seized two offices belonging to the oil company Perenco in Bogotá. The company is accused of financing the United Self-Defense Forces of Colombia (AUC) in exchange for security services between 1997 and 2005.
Indonesia has signed a memorandum of understanding with the United States to increase its energy imports. This deal, involving Pertamina, aims to diversify the country's energy supply sources.
VAALCO Energy continues to operate the Baobab field by renovating its floating platform, despite modest production. This strategy aims to maintain stable profitability at low cost.
An empty reservoir exploded at a Lukoil-Perm oil facility in Russia, causing no injuries according to initial assessments pointing to a chemical reaction with oxygen as the cause of the accident.
The British Lindsey refinery has resumed fuel deliveries after reaching a temporary agreement to continue operations, while the future of this strategic site remains under insolvency proceedings.
BP and Shell intensify their commitments in Libya with new agreements aimed at revitalizing major oil field production, amid persistent instability but rising output in recent months.
The private OCP pipeline has resumed operations in Ecuador following an interruption caused by heavy rains, while the main SOTE pipeline remains shut down, continuing to impact oil exports from the South American country.
McDermott secures contract worth up to $50 million with BRAVA Energia to install subsea equipment on the Papa-Terra and Atlanta oil fields off the Brazilian coast.
Saudi Aramco increases its oil prices for Asia beyond initial expectations, reflecting strategic adjustments related to OPEC+ production and regional geopolitical uncertainties, with potential implications for Asian markets.
A bulk carrier operated by a Greek company sailing under a Liberian flag suffered a coordinated attack involving small arms and explosive drones, prompting an Israeli military response against Yemen's Houthis.
The Canadian government is now awaiting a concrete private-sector proposal to develop a new oil pipeline connecting Alberta to the Pacific coast, following recent legislation intended to expedite energy projects.
Petrobras is exploring various strategies for its Polo Bahia oil hub, including potentially selling it, as current profitability is challenged by oil prices around $65 per barrel.
Brazilian producer Azevedo & Travassos will issue new shares to buy Petro-Victory and its forty-nine concessions, consolidating its onshore presence while taking on net debt of about USD39.5mn.
Major oil producers accelerate their return to the market, raising their August quotas more sharply than initially expected, prompting questions about future market balances.
Lindsey refinery could halt operations within three weeks due to limited crude oil reserves, according to a recent analysis by energy consultancy Wood Mackenzie, highlighting an immediate slowdown in production.
The flow of crude between the Hamada field and the Zawiya refinery has resumed after emergency repairs, illustrating the mounting pressure on Libya’s ageing pipeline network that threatens the stability of domestic supply.
Libreville is intensifying the promotion of deep-water blocks, still seventy-two % unexplored, to offset the two hundred thousand barrels-per-day production drop recorded last year, according to GlobalData.
The African Export-Import Bank extends the Nigerian oil company’s facility, providing room to accelerate drilling and modernisation by 2029 as international lenders scale back hydrocarbon exposure.
Petronas begins a three-well exploratory drilling campaign offshore Suriname, deploying a Noble rig after securing an environmental permit and closely collaborating with state-owned company Staatsolie.