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Based on the results of consultations in the videoconference mode, the OPEC + countries decided to move to a gradual increase in production from May to July in order to fully achieve the balance of supply and demand in the near future.

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Alexander Novak took part in the 15th ministerial meeting of OPEC and non-OPEC countries

According to Deputy Prime Minister Alexander Novak, following the consultations held via videoconference, the meeting participants discussed the current state of the world oil market, the implementation of the OPEC + March recommendations, as well as new recommendations for joint actions starting from May 2021. “The most important decision reached is to start from May 1 a general recovery of production by OPEC + countries within three months. So, in May the total increase will be 350 thousand barrels per day, in June – the same volume, in July – 441 thousand barrels per day. The countries will be included in the general schedule that was provided for in the April 2020 agreement. In addition, Saudi Arabia, which previously undertook additional obligations to reduce, also made a decision to further increase production, ”the Deputy Prime Minister said.

Russia will go in the general direction of increasing production, he said. “In previous months, separate decisions were made that allowed us to partially restore production from our quota, the remainder is 114 thousand barrels per day, and we, together with other countries, use this time to restore production,” said Alexander Novak. According to him, over the entire period of the deal, the OPEC + countries have managed to significantly affect the reduction in world reserves, including due to the conscientious implementation of the established recommendations.

“Today, the surplus on the market has dropped to 50 million barrels per day, in the remaining two to three months, the surplus will return to normal and meet the five-year average. At the same time, we expect an increase in oil demand of 5-5.5 million barrels per day. For the first time, we achieved the highest level of fulfillment, 113% in February. Those who did not cut the deadline must do it by September in addition to the new quotas, ”said Alexander Novak.

Increasing production is relevant for the Russian domestic market. According to the Deputy Prime Minister, the demand for oil products in Russia exceeds the dock level, and the mobility of the population remains high. “It is important for us to keep our finger on the pulse, to prevent market rebalancing. Assessing the monthly situation, you need to carefully monitor and prevent overheating, target the situation, taking into account the growth in demand, ”he recalled.

Among other things, the meeting participants touched upon the expansion of cooperation within the framework of the green agenda, stressed the importance of discussing global climate change and the prospects for renewable energy. “We support this process, Russia also attaches great importance to green energy and the topic, it is no coincidence that a corresponding conversation took place today between the Crown Prince of Saudi Arabia Mohammed bin Salman and Russian President Vladimir Putin,” said Alexander Novak.

EDITOR’S NOTE: This article is a translation. Apologies should the grammar and or sentence structure not be perfect.

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