Several members of OPEC+, including Saudi Arabia and Russia, announced on Sunday an extension of their oil production cuts until the end of December, thus postponing the reopening of the floodgates in the face of falling prices. The eight countries “agreed to extend their additional voluntary production cuts of 2.2 million barrels per day for another month”the alliance said in a statement. Also affected are Iraq, the United Arab Emirates, Kuwait, Kazakhstan, Algeria and Oman.
This decision aims to support prices, with American WTI and Brent hovering around $70 in the face of uncertain demand and accelerating supply. Members of the Organization of the Petroleum Exporting Countries (OPEC), led by Saudi Arabia, and their allies led by Moscow, entered into an agreement called OPEC+ in 2016 to better influence the market. This alliance, now made up of 22 members, currently keeps nearly six million barrels underground through three different mechanisms, both group-wide and in the form of voluntary cuts.
All the ministers are due to meet in early December in Vienna, headquarters of OPEC, but with Sunday's announcement, the eight countries making these voluntary reductions have already decided not to reopen the gold taps. black only from the start of 2025. This will therefore be at least three months behind the initial schedule: at the beginning of June, during the last ministerial meeting, OPEC and its allies announced their desire to increase their production from the month of October.
The alliance, however, took care to create a way out, insisting on several occasions that this decision could be reviewed at any time. Prices have been undermined for several months by economic uncertainties, particularly in China, the world's second largest consumer and the main driver of growth in global oil demand, and in the United States, suspended by the results of the American election scheduled for November 5. .
