When moving to the next stage of the OPEC+ deal, as part of the easing of restrictions, the growth of oil production will be completely absorbed by the market as demand gradually recovers, according to the communique following the meeting of the Alliance,
On Wednesday, key members of the Organization of Petroleum Exporting Countries (OPEC) and OPEC+ met via videoconference to discuss the situation in the energy market and the future of the oil deal.
As reported in the final release, the Ministerial monitoring committee concluded that "when moving to the next stage of the transaction, the additional supply that will result from the planned easing of production reduction measures will be absorbed as demand recovers."
As a result of the meeting, it was decided that countries that had not fulfilled the terms of the deal would have to submit to the OPEC Secretariat a plan for implementing the required compensation for June of this year by the end of July.
Taking into account these obligations for compensation, the real reduction in OPEC+ oil production from August should tentatively amount to about 8.1-8.2 million barrels per day, said the head of the Saudi Energy Ministry, Prince Abdulaziz bin Salman.
"The real reduction will be about 8.1-8.2 million barrels per day," Salman said.
Later, he clarified that, previously, the upper limit of reducing oil production in August was estimated at 8.343 million barrels per day, in September-about 8.34 million. According to the Minister, these indicators can still be clarified. He added that the next meetings of the OPEC+ Technical and Ministerial committees were scheduled for August 17 and 18.
Novak called the global oil market stable
The oil market is balanced and fairly stable. In June, the decline in demand due to the coronavirus was 10 million barrels per day compared to 25 million barrels per day in April, Russian Energy Minister Alexander Novak said.
"We see that the market and demand are recovering. If in April the decline in demand was about 25 million barrels per day in the whole world, today this recovery has occurred to a greater extent, and in June we saw a decrease in demand by about 10 million barrels, " Novak said during a press conference following a meeting of the OPEC+ monitoring committee of Ministers.
"In August, we expect that the decline (in oil demand-ed.) will be less than 10% (year-on-year-ed.)," he also stressed in an interview with Russia 24.
The Minister noted during a press conference that the OPEC+ countries made the right decision three months ago, which is now confirmed by the current situation on the oil market.
"The market is currently balanced and in a fairly stable state, taking into account production cuts by both OPEC+ countries and others that are not part of our coordination," Novak added.
GSV "Russia - Islamic World"
Photo: Creative Commons
Based on materials from RIA Novosti