MOSCOW, December 4. /TASS/. The OPEC+ countries have agreed to return 2 mln barrels of oil per day (bpd) to the market, but the increase in oil production will be gradual - in January 2021, it is planned to increase production by only 500,000 barrels per day. At the same time, OPEC+ will monthly assess the state of the market and, if necessary, adjust the production volumes within the framework of the deal, Russian Deputy Prime Minister Alexander Novak said at a press conference following the meeting of the OPEC+ countries.
"Starting from January 2020, the countries will increase their production by 500,000 barrels per day," he said. "Monthly meetings will be held starting from January - in be January, February, March - to assess the state of the market and make decisions on changing production levels for the next month," Novak added.
Meanwhile, the monthly adjustment of oil production from the beginning of 2021 can be either upward or downward, but by no more than 500,000 barrels per day (bpd), he added. "We will be ready to take into account both positive and negative factors in the analysis, so the decisions may be different. At the same time, we proceed from the assumption that each adjustment will be no more than 500,000 barrels per day every month," he said.
Novak added that a sharp increase in oil production from January 1, 2021, by 2 mln barrels per day (bpd), as originally stipulated by the OPEC+ agreement, would be dangerous for the market in conditions of low demand in winter. "The deal includes an increase of 2 mln barrels per day starting from January. We have agreed to increase by only 500,000 barrels per day, because we understand that 2 mln in the market would be unsafe, so a gradual growth is a good solution that allows us to essentially evaluate and target the market on a monthly basis," he said.
Russia may increase production from January 2021 by 125,000 barrels per day (bpd) under the new OPEC+ quota, this has been agreed with Russian companies. "As for the opportunities to increase [production] in January, indeed, if today we made a decision that together we will increase production by 500,000 barrels in January, then Russia's share in it is 125,000 barrels," he said.
Novak noted that this issue was discussed with Russian companies. "Companies have confirmed their readiness to increase [production] if such consolidated decision is made by all countries," he added.
At the same time, Russia’s compliance with the OPEC+ agreement since May 2020 is close to 100%, in November the level of implementation turned out to be about the same. "Russia has been fulfilling the agreement, starting from May, close to 100%, and November was no exception," he said.
Novak will discuss the situation in the oil market with Minister of Energy of Saudi Arabia, Prince Abdulaziz bin Salman Al Saud, during a face-to-face meeting in the second half of December in the kingdom. "As part of our bilateral exchange of views with my colleague, His Royal Highness Mr. Abdulaziz bin Salman Al Saud, we agreed that in the second half of December, we will hold a joint meeting with him in Saudi Arabia and discuss market conditions and issues related to energy cooperation between our countries," he said.