OPEC+ deliberates new crude oil output quota for members

Last updated Jun 4, 2023

OPEC and its allies are meeting to debate a new deal possibly adjusting countries’ output quotas for this year and next and a further cut in production.

The group faces flagging oil prices and a looming supply glut.

OPEC+, which groups the Organisation of the Petroleum Exporting Countries and allies led by Russia, pumps around 40% of the world’s crude, meaning its policy decisions can have a major impact on oil prices.

Sources said cuts could amount to 1 million bpd on top of existing cuts of 2 million bpd and voluntary cuts of 1.6 million bpd, which was announced in a surprise move in April and which took effect in May.

If approved, the new cut would take the total volume of reductions to 4.66 million bpd, or around 4.5% of global demand.

The April announcement helped to drive oil prices about $9 per barrel higher to above $87, but they swiftly retreated under pressure from concerns about global economic growth and demand. On Friday, international benchmark Brent settled at $76.

Typically, production cuts take effect the month after they are agreed but ministers could also agree a later implementation. They could also decide to hold output steady.

Reuters/Hauwa Abu