The Strategist

Reuters: OPEC+ intents to stick to its plan to boost oil production

01/07/2022 - 02:50

According to Reuters, OPEC+ will continue to its agreement to raise oil production in February.

Jonathan Cutrer via flickr
Jonathan Cutrer via flickr
In February, OPEC+ may increase output by 400,000 bpd, as it has done every month since August 2021. The remaining reduction would total 3.4 million bpd by the end of January.

OPEC+ must resume production by the end of September, according to the agreement. OPEC+ reduced its 2022 oil surplus prediction from 1.7 million to 1.4 million barrels per day. The shortage is predicted to be 1.5 million barrels per day by the end of 2021.

The November OPEC+ deal was 117 percent met, according to the agency's sources. The market received 0.7 million barrels fewer than anticipated. Non-OPEC countries fulfilled the agreement at a rate of 107 percent, while OPEC members fulfilled it at a rate of 122 percent.

The OPEC+ agreement was renewed in May 2020, implying a total production cut of 9.7 million barrels per day by all signatories. Participants in the agreement are expected to enhance monthly output by 400 thousand bpd. Russia and Saudi Arabia initially based their quota on an abstract production level of 11m bpd.