OPEC is its allies, turn on the taps

Audio 01:34

Logo of the OPEC organization in Vienna, Austria.

(Illustrative photo) JOE KLAMAR AFP / Archivos

By: Altin Lazaj

4 min

OPEC and its ten allies decided on Thursday to carefully open the taps.

They will gradually increase their daily production from the month of May.

Publicity

The Organization of the Petroleum Exporting Countries and its Russian-led allies have decided to increase the current level of production by 350,000 barrels per day in May, more so in June and 450,000 in July.

This increase is considered modest by analysts, because we are still very far from the levels of production before the crisis.

Indeed, the producer cartel already reduced its production by at least 7 million barrels per day last year, an unprecedented measure which consisted of supporting crude prices until today in the face of weak demand. caused by the health crisis.

For its part, Saudi Arabia, leader of OPEC, has also decided to gradually increase its daily production, which it had voluntarily reduced by one million barrels per day last February.

A way out of the crisis on the horizon

Producing countries have agreed to open the floodgates, noting that the world economy is recovering slowly, in particular thanks to the stimulus policies in the main crude consuming countries.

Vaccination campaigns also suggest that a way out of the crisis is possible for these countries from the summer.

By deciding to modestly increase their production, OPEC and its allies wanted to be cautious in the face of a pandemic which always holds surprises.

Indeed, Europe is experiencing a third wave of contamination imposing a strengthening of restrictive measures and the virus is spreading at high speed in countries which are as many growth markets for black gold, such as India.

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