An OPEC+ ministerial panel convened on Friday and maintained the current oil output policy, supported by Saudi Arabia’s decision to extend its voluntary production cut until September, which further boosted oil prices.
The panel, known as the Joint Ministerial Monitoring Committee, has the authority to call for a full OPEC+ meeting if deemed necessary. In July, oil prices saw a significant rise of over 14% compared to June, marking the largest monthly increase since January of the previous year.
Despite concerns about interest rate hikes and inflation impacting economic growth, tighter supply and increased demand drove the price surge, according to Gulf News.
The OPEC statement issued after the online meeting emphasized that the committee will continue to closely assess market conditions and encouraged members to fully comply with output cut commitments.
On Thursday, Saudi Arabia announced an extension of its voluntary one million barrels per day (bpd) oil output cut for September, with the possibility of further extensions or deepening. As a result, oil prices approached nearly $86 per barrel, near their highest level since mid-April. Russia also stated that it would cut oil exports by 300,000 bpd in September following the Saudi announcement.
Algeria, an OPEC member, had implemented an additional voluntary cut of 20,000 bpd for August and has yet to decide on an extension for September.
During their last policy meeting in June, the OPEC+ alliance previously agreed to limit supply until 2024, and Saudi Arabia committed to the voluntary production cut for July, which they extended to include August.
With the voluntary reductions from the three producers, the group’s total output cuts amount to 3.66 million bpd, approximately 3.6% of global demand. They have scheduled the next meeting of the JMMC on October 4.
