OPEC retains most of its oil production reduction plan
The 14th OPEC+ meeting was held via video on March 4, 2021. It was co-chaired by Saudi Arabia’s Energy Minister Abdulaziz bin Salman and Russian Deputy Prime Minister Alexander Nowak.
Abdulaziz bin Salman said at the beginning of the meeting that the correct approach is to be prepared. Although this sounds like a cliché truth, we must once again urge everyone to be cautious and vigilant. Let us I am convinced that a bright future is not a flash of light.
During the meeting, the parties discussed whether to resume the output of 1.5 million barrels per day. But after all, with the exception of Russia and Kazakhstan, other oil-producing countries have agreed to remain stable at the current level.
Russia and Kazakhstan will allow an increase in daily output of 130,000 barrels and 20,000 barrels, respectively.
Crude oil futures have now recovered all the ground lost during the first few months of the epidemic. Affected by the news that oil prices exceeded US$67 per barrel, the global crude oil benchmark Brent crude oil prices rose by 5%.
In January of this year, Saudi Arabia, the actual leader of OPEC, decided to cut oil production by an additional 1 million barrels per day to around 8.1 million barrels. The production cut plan was originally scheduled to expire in April this year, but Saudi officials said they will continue to cut production voluntarily until April this year.
Analysts have said that Washington will not be so active in trying to influence OPEC policy.
IEA predicts that in 2021, global oil demand will increase by 5.4 million barrels/day to 96.4 million barrels/day, recovering about 60% of oil demand. As more people are vaccinated, demand will surge in the second half of 2021.
Since the April 2020 meeting, by the end of January 2021, OPEC+ countries have controlled 2.3 billion barrels of oil per day, accelerating the rebalancing of the oil market.
The next meeting will be held on April 1, 2021, at which time the level of oil production in May will be discussed.