Oil prices rose more than a dollar in early trade Monday after OPEC+ declared a one-month extension of oil production adjustments announced in November 2023 until the end of the month of December.
Brent oil futures rose $1.14 per barrel, or 1.56 percent, to $74.24 per barrel. U.S. West Texas Intermediate crude oil rose $1.14 per barrel, or 1.64 percent, to $70.63.
The OPEC+ alliance, which includes the Organization of the Petroleum Exporting Countries (OPEC), Russia and other countries, was due to increase production by 180,000 barrels per day in December, after postponing last October's increase in due to the drop in prices.
In Morocco, the cost of gasoline has followed an upward curve in recent years, largely influenced by the volatility of the international oil market. Morocco, a net importer of oil, is particularly vulnerable to fluctuations in world prices. Currently, the price of gasoline is more than 13 dirhams per liter in several stations. The cost of fuel directly impacts household budgets and weighs on key sectors of the economy, notably transport and agriculture.
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OPEC+'s strategy of maintaining moderate production is mainly aimed at supporting prices and avoiding a sharp fall in the market. Indeed, the organization has opted for a cautious policy in the face of a complex geopolitical context, marked by tensions in Eastern Europe and the Middle East. These supply regulation choices are not without consequences for economies dependent on oil imports, such as that of Morocco. In the short term, the move could increase inflation, a major challenge that is seeing the cost of living rise rapidly across the world.
Unless crude prices fall on the global market, countries will struggle to curb the surge in gasoline prices. In Morocco, the government is exploring options to mitigate the impact on citizens, such as establishing temporary subsidies for transporters. However, this aid remains insufficient to offset all of the increases. In addition, the transition to renewable energies, although encouraging, remains in development and cannot immediately compensate for this dependence on fossil fuels.
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