OPEC Plus keeps the oil production policy unchanged
Oil markets are struggling to assess the impact of a slowing Chinese economy on demand.
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Two sources in “OPEC Plus” said that the group decided to stick to its oil production targets at its meeting yesterday, while oil markets are struggling to assess the impact of the slowdown in the Chinese economy on demand, and the repercussions of the G7’s decision to put a price ceiling on Russian oil on supply.
The decision comes two days after the Group of Seven agreed on a price ceiling for Russian oil.
OPEC+ includes the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia.
The group angered the United States and other Western countries in October, when it agreed to cut production by two million barrels per day, or about 2% of global demand, from November to the end of 2023. OPEC Plus attributed its decision at the time to cut production to weak economic expectations.
Oil prices have fallen since October due to slowing growth in China and globally, and higher interest rates, which has led markets to speculate that the group may cut production again.
A source in «OPEC Plus» said, after the main ministers of the organization reached the decision: «The decision is to extend until the end of 2023».
Last Friday, the G7 countries and Australia agreed to impose a cap on the price of a barrel of Russian crude oil transported by sea at $60 a barrel, in a move aimed at limiting Moscow's revenues, while preserving the flow of Russian oil to global markets.
Moscow said that it would not sell its oil under this ceiling, and that it was studying the situation to respond.
Several analysts and OPEC ministers asserted that the price cap is confusing and possibly ineffective because Moscow sells most of its oil to countries such as China and India, which have refused to condemn the war in Ukraine.
Sources said that OPEC met remotely, the day before yesterday, without Russia and its allies, and did not discuss the price ceiling for Russian oil.
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