“All market participants are interested in restoring the balance of supply and demand. The extension of the cuts needed in the face of uncertainty and fragile recovering demand, we had a more predictable situation,” explained Alexander Novak.
the Minister stressed that the market monitoring is continuous and it allows for timely, quick and flexible to respond to changing market conditions. Speaking about the possible risks, the head of the Russian Minister noted that Russia and other participants in the transaction OPEC+ chose the path of organized production decrease.
In other countries, such as USA or Canada, mining is regulated by market instruments. Russia and other OPEC members+ never set ourselves the target to a negative situation in the market is damaging to economies not party to the transaction countries, said the Russian Minister.
100% the transaction was executed in Saudi Arabia, UAE and Kuwait. Russia fulfilled its obligations by 96%. The main “offenders” were Iraq (in may has reduced production to less than half of the quota), Nigeria and Azerbaijan have reduced production only half of the required volumes, and Algeria, to have fulfilled its obligations only 7% of the quota.
energy Minister of Saudi Arabia Prince Abdulaziz bin Salman said that the “losers” OPEC+ will offset backlog reductions on a voluntary basis, as the parties to the transaction, no additional tools of influence on those who fail to meet quotas. According to him, Iraq has announced that in June will be released on 80% quota reduction, and further compensates for the remaining volumes.
in addition, the Saudi Minister confirmed that in June, Saudi Arabia, UAE and Kuwait will further cut production by 1.2 million barrels per day, without extending this obligation for the next months.
At the press conference also raised the question about increased production in Libya. The Saudi Minister confirmed that OPEC+, taking a decision on the extension of the reductions to take into account the possible recovery of production in the country. “But Libya is still very far from their maximum volumes, therefore, to extend to it the reduction would be unfair, said Prince Abdulaziz bin Salman.
the New agreement, OPEC+ valid from the beginning of may 2020. The biggest quota of decline in production from the largest producers of “black gold” – Russia and Saudi Arabia. Both countries should cut oil production from the nominal level of 11 million to 8.5 million barrels per day. Other countries cut production from level of October 2018.
All the participants confirmed their commitment to its complete implementation. The next meeting of the joint Ministerial monitoring��th Committee is scheduled for June 18. Its meetings will be monthly until December. The next Ministerial meeting of OPEC countries plan to spend on 1 December.
