The possibility of a delay in the program to ease the supply reduction of OPEC+ members in October
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According to Reuters, this action comes amid concerns about a slowdown in global economic growth, especially following the publication of data on a decline in demand from China, the world’s largest oil importer. Oil prices have decreased.
The eight members of the OPEC Plus coalition were preparing last week to increase their production by 180,000 barrels per day in October as part of a gradual easing program to reduce the voluntary supply of crude oil.
However, the fragile conditions of the oil market over the prospect of more supply from OPEC Plus and an end to the Libyan export freeze dispute, along with the prospect of reduced demand, are raising concerns, one of the sources said. has become a member of this coalition.
Another of these sources close to OPEC+ said that a delay in the increase in oil production in October looks “very likely”.
Whispers of a possible delay in increasing OPEC+ oil production caused the price of North Sea Brent crude oil to increase by more than One dollar will reach 74 dollars and 80 cents per barrel. However, then the price of this crude oil index dropped to around $73 per barrel, which is the lowest level since December.
OPEC and Saudi Arabia’s government communications office did not respond to requests for comment.
The dispute between rival factions in Libya (eastern and western governments), one of the oil producers in OPEC, over the control of the central bank, which led to a decrease of at least 700 thousand barrels of daily oil production in this country. has contributed to the growth of oil prices in recent weeks.
However, the publication of news about the possibility of reaching an agreement to resolve this dispute caused oil prices to decrease by about 5% in transactions on Tuesday (September 13). At the same time, the drop in Chinese demand and the decline in refinery margins in the world, which can force refiners to reduce crude oil refining, have also been influential.
Helima Kraft, investment bank analyst RBC Capital said in a note: China’s weak performance has lowered forecasts for 2024 growth. And it has started the decreasing trend of crude oil imports and the capacity of refineries in 2023.
He added: It seems wise for OPEC+ to wait until December to increase supply to the market.
OPEC Plus members have agreed to cut their production by a total of 5 million barrels from the end of 2022 until now in order to support the market due to uncertainty in the demand outlook and increased supply from producers outside the alliance. reduce 860 thousand barrels per day or about 5.7% of the global oil demand.
Producers of this alliance agreed in June to continue cutting 3.666 million barrels of oil production per day until the end of 2025. The members also agreed to extend the latest cuts, which include a 2,200,000-barrel-a-day reduction in eight members’ production, for three months until the end of September 2024, and after that, gradually ease their voluntary crude oil production cuts from October to September 2025. do.
The 180,000-barrel-a-day facility is for members’ voluntary supply cuts in October, which may be delayed, for eight OPEC+ members.
