OPEC+ expected to decide on future oil cuts on Thursday


THE OPEC+ alliance of oil-producing countries will convene on Thursday to make a final decision on the future volume of the oil production cuts following days of deadlocked talks, which even led to a postponement of the alliance’s meeting, reported Sputnik news agency.

The first signs of disagreements within the OPEC+ group emerged last weekend when the oil producers held informal consultations, during which they reportedly have failed to reach a consensus. On Monday, OPEC energy ministers convened for a 180th meeting in order to reach a consensus within the organisation on the volume of oil production cuts. However, no recommendation was issued after the meeting.

According to media reports, the talks are complicated by the standoff between two historic allies – Saudi Arabia and the UAE. Abu Dhabi reportedly is displeased with the steady underperformance of some OPEC+ members such as Iraq and Russia, while the UAE itself is pressured to showcase 100 per cent compliance. The Emirates also calls for the underperformers to continue slashing more oil output to offset previous shortcomings.

Against the background of these differences within the alliance and a growing second wave of COVID-19, OPEC+ members have to decide on Thursday whether to extend the current oil production cuts of 7.7 million barrels a day (mbd) starting from January 1 or ease the quota by 2 million barrels a day. Sources told Sputnik on Monday that the OPEC states are leaning toward extending the 7.7 mbd oil output cuts.