OPEC: Gradual Increase in Oil Production Postponed

During an extraordinary meeting via videoconference, the energy ministers of the eight member states of the Organization of the Petroleum Exporting Countries (OPEC) decided to “postpone the gradual increase in crude oil production in their countries for two months.” The announcement was made by the Algerian Ministry of Energy, which wrote in a press release that “the resumption of production has been postponed until December 1, 2024.” According to the press release, “the decision reflects the desire of the eight OPEC countries to maintain the stability of the global oil market in order to prevent new sharp price fluctuations.”

In addition to Algerian Energy Minister Mohamed Arkab, the online meeting was attended by counterparts from Saudi Arabia, the OPEC leader country, Iraq, Kuwait, Kazakhstan, Oman, Russia, and the United Arab Emirates. All these oil-producing countries have been complying with OPEC’s general decision on so-called “voluntary production cuts” for months.

According to a statement from Algeria’s energy ministry, “in the course of the meeting, the ministers discussed the latest developments in the international oil market, the situation of the oil industry in some OPEC+ countries, and how production reduction commitments are being honored.” In this context, it was emphasized that “the production oversupply achieved by some countries in previous months will be gradually offset starting in September.”

During the meeting, Iraqi Oil Minister Hayyan Abdul Ghani said his country had cut oil production to 3.3 million barrels per day as of August 27. The production cut is part of Iraq’s commitment to OPEC+ decisions and is in line with what was agreed during OPEC Secretary General Haitham al-Ghais’s recent visit to Baghdad. The move also includes a reduction in domestic oil consumption. Iraq subsequently agreed to extend additional production cuts of more than one million barrels per day through the end of November 2024.