OPEC + countries plan to extend the oil reduction deal. Many countries, including Russia, are in favor of the extension. Saudi Arabia has not yet voiced its decision in this regard. At the same time, the Kingdom recently expressed interest in extending the deal.
Mitigation of restrictive measures in some regions has led to an increase in energy demand. Also, finally, oil prices rose sharply thanks to the OPEC + deal. This also influenced the end of the price war between Saudi Arabia and Russia. Now the parties to the transaction need to decide how long to maintain the current conditions for reducing oil production.
These days there is a discussion of the date of the next meeting on the OPEC deal. There was a proposal to hold it earlier than June 9, as previously planned, and to schedule a meeting for June 4.
Recently, both Russia and Saudi Arabia are changing their positions regarding the OPEC deal. But at the same time, they always manage to find a convenient solution.
Not everyone supports the OPEC deal. US shale companies are gradually increasing oil production.
Texas-based Parsley Energy, announced plans to restore daily oil production (26,000 barrels per day) in June. The volume of oil production in the Bakken formation has also grown from mid-March by 35,000 barrels per day.
The initial OPEC + deal suggested that its participants cut oil production by 9.7 million barrels per day. This is about 10% of world production. Then, Saudi Arabia, Kuwait and the UAE decided to further reduce production by 1.2 million barrels per day in June. Thus, the total reduction in oil production by OPEC + participants in June should be about 11 million barrels per day.
The material has been provided by InstaForex Company – www.instaforex.com
Source: OPEC + countries plan to extend the oil reduction deal.