Reuters reported thatOPEC+It will likely discuss halting the January oil production increase among other options, which could provide broad signals that the move by major oil importing countries, which have declared their resort to their oil stocks to lower prices, has paid off.
Brent crude prices fell to about $ 70 a barrel, down from their high levels in October, when they exceeded $ 86, to record Highest level in three years.
Last month, prices recorded the largest monthly decline since the beginning of the Covid-19 pandemic, after the mutant “Omicron” raised fears of an oil glut. The price of Brent crude, the benchmark, fell below $70 a barrel, on Thursday.
The “OPEC +” bloc, which includes producers members of the Organization of the Petroleum Exporting Countries “OPEC” and its allies, objects to US demands to increase oil production to support the global economy. Producers said they did not want to derail the fragile recovery in the energy industry by causing a new oversupply.
Before this week’s meetings, Russia and Saudi Arabia, the largest producers in the “OPEC +” bloc, stressed that there was no need for a random reaction to adjust policy. Iraq said that the “OPEC +” producers are expected to extend the current production policy in the near term.
Since August, the bloc has increased production by 400,000 barrels per day per month, as part of a gradual reversal of the record production cuts agreed by producers in 2020, when demand for oil plummeted due to the pandemic.
And on Wednesday, “OPEC +” experts said in a report seen by “Reuters”, that the repercussions of the “Omicron” mutant are still unclear, although many countries have begun to apply restrictions to besiege it.
Even before fears of “Omicron” emerged, the “OPEC +” bloc was studying the repercussions of the announcement made last week by the United States and other major oil consuming countries, regarding Extracting quantities of oil reserves Raw to calm prices.
OPEC expected a supply surplus of three million barrels per day in the first quarter of 2022 after withdrawing from the reserves, up from 2.3 million barrels per day in its previous estimates.
However, the report said that the repercussions of withdrawing from the reserves will be limited; Because some countries have made it voluntary, and because its time range is not clear.
And David Turk, US Deputy Secretary of Energy, told Reuters on Wednesday that the administration of President Joe Biden may adjust the timing of withdrawing from the reserves if prices fall sharply.
The “OPEC +” bloc is gradually reversing the record production cuts it decided last year and amounted to ten million barrels per day, equivalent to approximately 10% of global oil supply. Of these cuts, 3.8 million barrels per day are still in effect.
However, OPEC’s oil production in November was below target again, as some members of the organization are facing difficulties in increasing production capacity.
(Reuters, The New Arab)