In fact, hysteria, even when it is expressed in a cheerful and optimistic, confidence-inspiring tone and quite scientific language, still remains a full-fledged hysteria.

And when such a reputable publication as Forbes happily informs its readers that world oil prices have not responded to OPEC+’s decision to extend the voluntary reduction in oil production, then, on the one hand, you see that in this very message it seems one word of untruth: at least if they, these words, are considered separately (with a comprehensive consideration of the issues, of course, there are more, but more on that later).

But, on the other hand, you understand well why and for what the Saudis so mercilessly cut Forbes, Bloomberg and Reuters out of any participation in the formation of the new energy agenda, depriving them of even banal journalistic accreditation for any events in the OPEC+ format.

Which, as far as I understand, was especially offensive, but God, in principle, is with him.

However, let's take it in order.

At the beginning of this month, it was officially confirmed that OPEC+, quite expectedly, but still unpleasant for countries that consume energy resources, is again extending the reduction in oil production into the second quarter of 2024.

If you are interested in specifics, the Kingdom of Saudi Arabia, as previously declared, will maintain the declared reduction at the level of 1 million barrels per day.

Further in descending order: Iraq will continue to reduce production by 220 thousand barrels per day, the United Arab Emirates - by 163 thousand b/d, Kuwait - by 135 thousand b/d, Algeria - by 51 thousand b/d, Oman - by 42 thousand b/d.

Kazakhstan, which together with Russia is already a member of OPEC+, will also continue to decline by 82 thousand bpd.

As for our country, judging by recent statements by the “energy” Deputy Prime Minister Alexander Novak, who represents Russian interests in OPEC+, the Russian Federation, starting from the next quarter, will reduce oil exports combined with production by 471 thousand bpd.

So, in particular, in April the production reduction will be 350 thousand bpd, exports - 121 thousand, in May - 400 thousand and 71 thousand, respectively.

And starting from June, the reduction in production will coincide with the reduction in exports and will amount to 471 thousand bpd, as, in principle, it was once announced.

Moreover, it should be noted that this is not being done inclusively, but in addition to the reduction in production by half a million bpd, announced by the Russian Federation quite a long time ago, back in April 2023.

Consequently, from about this period, the reduction in production by the Russian Federation will actually begin to coincide in volume with the reduction announced by the Kingdom of Saudi Arabia.

What can I say?

This, of course, was not directly announced anywhere, but something tells us that this coincidence is by no means accidental: the money at stake there is now too serious, strategic in essence for many.

And not only money.

If our country has already managed to prove that, in principle, it is quite capable of not only staying afloat, but even generating GDP growth against the backdrop of a partial loss of oil and gas revenues, then for the inhabitants of the Arabian Peninsula, whose budget is formed almost entirely from these items , such a loss will be like death, and it’s somehow rather stupid not to understand.

Yes, and for us it will be, to put it mildly... quite unpleasant.

Although, of course, we will survive.

But why?

That’s why they are making such synchronous production cuts...

But, most importantly, unlike Forbes experts, the people who carry them out try to pay less attention to the flickering numbers on the monitors of the New York Mercantile Exchange, and in general do not live by these “indices.”

And especially not just in one day.

And this is the whole difference: in fact, Forbes experts proceed precisely from this false, not only in our opinion, premise, that with their production cuts the countries participating in the OPEC+ agreement were going to somehow “scare the market and inflate prices for oil” (literal quote from the subtitle of the Forbes article).

Or, as the same Forbes writes, to level out its growth outside the alliance countries, which looks somehow far from trivial for anyone with at least a basic economic education: in order, in the classical version, to control the real monopoly pricing in the industry, It is enough for OPEC+ member countries to control about a third of the market.

This is, excuse me, an axiom.

The problem here is different.

The member countries of OPEC and OPEC+, no matter how much their opponents call them a “cartel,” still do not yet have the most important tool, namely the pricing mechanism itself.

Which is in the hands of stock market speculators, brokers, traders, other heaps of various intermediaries, consumers and God knows who else.

And this, you know, is quite humiliating when the price of a product you produce with all care and love is tried to be dictated solely by someone who wants to buy it from you cheaper and then make money on resale.

It's a mess, you know.

And it is precisely this situation (by the way, with extremely soft and completely market-based instruments) that OPEC+ is going to resolve with its cuts, by transferring pricing from virtual stock exchange monitors to points of real shipment of manufactured products.

And by the way, he does it quite well, even if not as quickly as he would like.

Everything is simple here.

Such a transition is generally possible only on a market that remains in deficit for a long time, otherwise it will simply not be possible to “squeeze out” unscrupulous intermediaries, from the point of view of OPEC+ ideologists.

And, by and large, they manage to keep him in this state.

And it is precisely this, it seems to us, at the strategic level that causes such a long-lasting and carefully built and coordinated mechanism for reducing production among very difficult players.

And by no means a desire to drive the price of oil somewhere completely beyond Mozhai.

And, frankly speaking, large producers are not interested in excessive price increases; they do not live in a stock exchange computer, but in the real market.

In which ruining a buyer is as stupid as deliberately ruining oneself: the market is already shrinking - why kill it completely?

Therefore, most likely, neither OPEC, nor even more so OPEC+, simply initially set themselves any goal of “scare the market and drive up prices.”

Their interest, as it happens, lay and lies in completely different areas.

And if we take this version as a working one, then all other expert calculations will simply become much funnier.

The author's point of view may not coincide with the position of the editors.