MOSCOW, December 3. /TASS/. Kremlin Spokesman Dmitry Peskov did not comment on the prospects for revising the parameters of the OPEC+ deal.
- OPEC+ talks on oil output cuts postponed to December 3
- OPEC+ agreement leaders suggest different mechanisms of oil production cuts in 2021
- OPEC postpones decision-making on 2021 production levels until December 1
- Current OPEC+ differing viewpoints 'work-related issue', says Kremlin
- OPEC+ monitoring committee meeting yields no consensus
"Today there will be a meeting and after that, I think, my colleague [Russian Deputy Prime Minister Alexander] Novak will provide information. Before that, I will not anticipate anything," Peskov told reporters. He was asked whether Moscow really supports a gradual increase in production under the agreement.
The last round of negotiations of oil exporters under the OPEC+ agreement will take place on Thursday, December 3. Ministers will have to find a compromise solution on oil production levels in 2021, based on conflicting views within the union.
Disagreements in the alliance
The situation inside the OPEC+ oil alliance, which accounts for 40% of world production, is heating up as the New Year approaches. It was from January that the countries participating in the agreement were going to weaken the strongest restrictions on oil production in history, adopted back in April. The parties were to ease the production restrictions from the current 7.7 million bpd to 5.8 million bpd. That means that the members of the alliance planned to increase the extraction of raw materials by almost 2 million bpd.
But since about mid-November, they have been actively negotiating how timely mitigations are amid the second wave of lockdowns due to the pandemic. Some countries, such as Saudi Arabia, are convinced that the time has not come yet to increase oil supply, and the current parameters of the deal should be extended by at least three months.
The United Arab Emirates unexpectedly opposed this plan. Abu Dhabi finds that it is possible to extend the restrictions in their current form only if all participants in the transaction comply with the agreements. But since there are "debtors" among the partners who have not reduced oil production in accordance with quotas, there is no point in extending it, Abu Dhabi believes. Finally, Russia and Kazakhstan suggested that production should be increased gradually, starting from January and during the first quarter of 2021, as isolation measures in many countries are not as strong as in spring.
Series of meetings
The allies were unable to choose an option that would suit everyone either at the meeting of the monitoring committee on November 17, or during subsequent consultations. Even the ministerial conference on November 30, involving the OPEC countries only, brought no result. Cartel members failed to make a decision to determine a production plan from the New Year on until a preliminary agreement is reached with non-OPEC partners. The OPEC+ meeting scheduled for December 1 had to be postponed to December 3.
OPEC+ Agreement
The renewed agreement on the reduction of oil production OPEC+ has been in effect since May this year. The first stage of the deal, when the alliance countries reduced production by 9.7 million bpd, ended in July. From August and until the end of this year, the oil producing countries are to cut 7.7 million bpd. From January 1, 2021, the restriction is set at 5.8 million bpd. The agreement is valid until April 2022.