OPEC may cut oil production for balance in the market

Baku, December 24, AZERTAC

OPEC countries have carefully studied the decision on new production cuts, voiced earlier in December, but if necessary, the alliance may extend the transaction or even increase the volume of oil production decline, said OPEC President, UAE Energy Minister Suheil al-Mazrouy, according to Voiceofpeopletoday.com.

“The planned reduction in production was carefully studied, but if it does not work, then we always have the option to convene an extraordinary meeting of OPEC, as we have done in the past,” said al-Mazrui, quoted by the Bloomberg agency.

“If the situation develops in such a way that it is necessary to extend (a deal – ed.) For another six months, we will do it, if you need to cut more, we always discuss and come to a balanced decision,” he added.

The UAE Minister, however, noted that OPEC may in fact over-execute the deal, since in some countries there is a natural decline in oil production.

According to him, commercial oil reserves in OECD countries by 37 million barrels exceed the average value over the past five years, but in the first quarter the market should be balanced.

OPEC + December 7 decided to reduce oil production in total for all countries of the agreement by 1.2 million barrels per day from January 2019 for six months. Of these, 800 thousand barrels of oil will be in OPEC countries and 400 thousand in non-OPEC countries.

However, the OPEC + decision has not yet helped stabilize prices. Since December 7, the oil market has already experienced several collapses. So, on Friday, December 21, the price of Brent for the first time since September 5, 2017, fell below $ 53 per barrel.