After a virtual meeting of the 23 countries of the alliance known as OPEC+, this organization announced that the oil market "is well balanced" and price volatility "is not not caused by changes in the market fundamentals, but by current geopolitical events."
Consequently, OPEC+ decided to increase its global production by 400,000 barrels and meet again on March 31. This decision was foreseeable given that Arabia Saudi and other members made it clear previously that they would not modify the roadmap defined in August 2021.
Today's decision sets OPEC+'s maximum production limit at 41.698 million barrels per day (mbd). From this amount, 24.316 mdb correspond to OPEC (not including the pumping of Venezuela, Iran and Libya) and 16.381 mbd to the group of the ten allied independent producers.
The 26th OPEC and non-OPEC Ministerial Meeting has commenced under the Chairmanship of HRH Prince Abdul Aziz bin Salman, Saudi Arabia’s Minister of Energy, and Co-Chair HE Alexander Novak, Russian Deputy Prime Minister, together with … pic.twitter.com/BTLA4ZQv3F
The quotas of Saudi Arabia and Russia, by far the largest producers and exporters of the OPEP+, will rise to 10,436 mbd next month.
According to the August 2021 planning, OPEC will gradually increase its production until reaching the pre-pandemic output level in September. The United States and other consuming countries, however, consider that the increase of 400,000 barrels per day will not halt the rise in international oil prices, a trend exacerbated by the Russia-Ukraine conflict.
On Wednesday, the price of Brent crude, which is used as a benchmark in Europe, reached US$111.59 on the London futures market. This figure implied an increase of 6.3 percent with respect to the close of the previous day.