Get 40% Off
⚠ Earnings Alert! Which stocks are poised to surge?
See the stocks on our ProPicks radar. These strategies gained 19.7% year-to-date.
Unlock full list

OPEC+ talks focusing on deeper oil cut, sources say

Published 11/29/2023, 04:01 AM
Updated 11/29/2023, 02:00 PM
© Reuters. FILE PHOTO: OPEC's logo is seen in this illustration taken, October 8, 2023. REUTERS/Dado Ruvic/File Photo

By Maha El Dahan, Olesya Astakhova and Alex Lawler

DUBAI/LONDON (Reuters) -OPEC+ talks on 2024 oil policy ahead of a Thursday ministerial meeting were focusing on an additional oil supply cut to support the market, although the details were yet to be agreed, sources close to the group said.

Saudi Arabia, Russia and other members of OPEC+ pump around 43 million barrels per day, or over 40% of global supply. They already have supply cuts in place of about 5 million bpd, or about 5% of global demand.

Two OPEC+ sources said the group was discussing a deeper collective supply cut in the first quarter of which the exact duration and volume was not yet clear. One of them said OPEC+ may not be able to agree on this and it was possible the meeting could roll over existing policy.

The Wall Street Journal reported the new cut could be of as much as 1 million bpd, a figure that the Financial Times had also reported on Nov. 17.

On Tuesday, sources had said a further delay to Thursday's meeting of the Organization of the Petroleum Exporting Countries and allies was possible, although as of Wednesday evening the meeting looked set to go ahead as planned.

The meeting has already been delayed from Nov. 26. OPEC+ sources said this was because of a disagreement over output quotas for African producers, though sources have since said the group has largely resolved this issue.

The talks on African quotas come against a backdrop of the United Arab Emirates being allowed, as per OPEC+'s last agreement in June, to raise output in 2024.

Global benchmark Brent crude oil was up 1.3% and near $83 a barrel as of 1836 GMT on Wednesday [O/R]. Prices have dropped from near $98 in late September, pressured by concerns about weaker economic growth and expectations of a supply surplus in 2024.

OPEC+ talks over production quotas have often been difficult in the past, most recently at their June meeting, which extended existing oil output cuts into 2024 and agreed the increase for the UAE because of its efforts to expand production capacity.

© Reuters. FILE PHOTO: OPEC's logo is seen in this illustration taken, October 8, 2023. REUTERS/Dado Ruvic/File Photo

Saudi Arabia, Russia and other members of OPEC+ have already pledged total oil output cuts of about 5 million bpd in a series of steps that started in late 2022.

This includes Saudi Arabia's additional voluntary production cut of 1 million bpd, which is due to expire at the end of December, and a Russian export cut of 300,000 bpd until the end of the year.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.