OPEC Plus, where oil-producing countries such as Russia join OPEC = Organization of Petroleum Exporting Countries such as Saudi Arabia, has decided to maintain the scale of the current cooperative production cut.
It seems that he was thinking about the impact of concerns about a slowdown in the world economy and sanctions on Russian crude oil.
OPEC Plus held an online meeting on the 4th to decide future crude oil production.
As a result, we have decided to maintain a coordinated production cut of 2 million barrels per day.
The decision was made not to change the production volume, while supporting crude oil prices by reducing production.
In the background, changes in crude oil supply and demand and prices are difficult to predict.
Crude oil prices are on a downward trend against the backdrop of rapid interest rate hikes in Europe and the United States and economic stagnation in China, where strict restrictions are being imposed under the "Zero Corona" policy.
On the other hand, the EU = European Union will, in principle, ban the import of Russian crude oil from the 5th, and the G7 = 7 major countries will impose sanctions against Russia, setting the maximum price of international trading of Russian crude oil to 1 barrel. decided to set it at $60.
It seems that OPEC Plus, including Russia, had an idea to see how the sanctions would change the supply and demand and prices of crude oil in the future.
The next meeting will be in June next year, but "if necessary, we are ready to respond to market developments and take additional measures immediately."
What is the history of the production adjustment?
OPEC (Organization of the Petroleum Exporting Countries) led by Saudi Arabia and non-member oil-producing countries such as Russia have formed a group called "OPEC Plus" and are adjusting crude oil production while monitoring crude oil demand trends.
OPEC+ agreed in April two years ago to implement a large-scale production cut of 9.7 million barrels per day, supporting international crude oil prices.
After that, in July last year, it was agreed to gradually increase crude oil production, citing that global demand for crude oil, which had temporarily declined due to the effects of the new coronavirus, is increasing.
Since August last year, the production volume will be increased by about 400,000 barrels per day every month, and from May to June this year, the increase will be expanded to 432,000 barrels per day.
Furthermore, in response to requests from Europe and the United States, which are suffering from inflation due to soaring energy prices, the increase in production was expanded to 648,000 barrels per day in July and August.
On the other hand, crude oil prices are trending downward due to the view that the global economy will slow down due to the rapid interest rate hikes in Europe and the United States and the continuation of China's "zero corona" policy, and the demand for crude oil will be sluggish.
In response to President Biden of the United States visiting the Middle East in July and urging to increase crude oil production, OPEC Plus decided to increase production by 100,000 barrels per day, albeit slightly, in September, but reduced production from October. Since last month, we have been implementing a production cut of 2 million barrels per day, which is the largest reduction since 2020.