Alexander Novak at the 35th OPEC+ ministerial meeting
Deputy Prime Minister Alexander Novak co-chaired the 35th ministerial meeting of the OPEC and non-OPEC countries and the 49th meeting of the OPEC+ Joint Ministerial Monitoring Committee.
The participating countries agreed to adjust oil production to 40.46 million
barrels per day from 1 January to 31 December 2024. This decision is to secure long-term market benchmarks,
maintain market stability, and create predictability in the long run. The
parties confirmed the critical importance of full conformity to the deal’s
terms and the need for countries exceeding their production quotas to pay
compensation in keeping with a table accepted by the meeting participants in
addition to the established oil production levels.
“Russia will adjust its oil production level to 9.828 million barrels per day
(according to independent sources) and will additionally extend its voluntary reduction
by 500,000 barrels per day until the end of December 2024 as a precaution in
coordination with the OPEC+ member states, which announced a voluntary oil
output cut in April. This is a voluntary step, but it will also depend on the
required production level coordinated at the 35th OPEC+ ministerial
meeting on 4 June 2023. The overall oil production cut by the OPEC+ countries
until the end of 2024 will amount to 3.66 million barrels per day from the
October 2022 level,” Deputy Prime Minister Alexander Novak said.
“The Kingdom of Saudi Arabia will additionally cut its oil production by 1
million barrels per day as a voluntary measure throughout July, which may be
extended so that the Kingdom’s production level will reach 9 million barrels
per day, whereas the overall voluntary reduction will make up 1.5 million
barrels per day,” the Kingdom’s SPA
Agency reported with reference to an official source in the Royal Energy
Ministry.
Production cuts could also be implemented by Nigeria,
Congo, and Angola following an independent audit by three companies (IHS,
WoodMackenzie, and RystadEnergy) specialising in oil production evaluations.
The aim is to identify country production capacities to be used to achieve
control levels of output for 2025. The
OPEC Secretariat will coordinate the evaluation effort, while maintaining
independence of these three sources, the communiqué of the ministerial meeting
in Vienna says. The adjustment has to be carried out until the end of 2023.
Nigeria’s current oil production plan is 1.578 million barrels per day.
“We see a supply-and-demand balance in the international market, including
thanks to the decisions adopted by OPEC+.
Today, we are recording a rise in demand, especially in the summer
period, due to a rise in flights. As for
the terms of the production cut deal, they are being over-fulfilled. The terms
of the voluntary agreement to cut production,
which came into force in May 2023, are being implemented as well. Russia is
meeting its obligations in full,” Alexander Novak said.
The next OPEC+ meeting is scheduled for 26 November in Vienna. Meetings of the
OPEC+ monitoring committees will be held once every two months. In this
context, the Joint Ministerial Monitoring Committee retains its power to hold
additional meetings or request an OPEC+ ministerial meeting at any time to review
changes in the market, when deemed fit.
