July 19, 2024
OIL MARKET: Prices still rising toward $90 per barrel over OPEC output cut
– By Godswill Odiong

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By Eyo Nsima
The latest 1.16 million barrels per day, bpd oil cut by the Organisation of Petroleum Exporting Countries, OPEC, has continued to send oil prices rising in the global market.

Oil prices had instantly risen to about $84 per barrel in response to the cut, which major consumers, especially the United States, have widely criticized.

But Tuesday morning, many watchers of the volatile market, wake up to see oil prices, spiraling further toward $90 per barrel.

For instance, the prices of Brent, Murban crude, and Bonny Light surged further to $85.60, $86.10, and $84.91 per barrel respectively.

The decision to cut supply was taken at the just-concluded 48th Meeting of the Joint Ministerial Monitoring Committee (JMMC) of OPEC, which took place via videoconference on Monday, 03 April 2023.

In a statement obtained by The Daily, www.thedaily-ng.com, OPEC, stated: “The Committee reviewed the crude oil production data for the months of January and February 2023 and noted the overall conformity for participating OPEC and non-OPEC countries of the Declaration of Cooperation (DoC).

“The Members of the JMMC reaffirmed their commitment to the DoC which extends to the end of 2023 as decided at the 33rd OPEC and non-OPEC Ministerial Meeting (ONOMM) on 5th of October 2022 and urged all participating countries to achieve full conformity and adhere to the compensation mechanism.

“The Meeting noted the following voluntary production adjustment announced on 2 April 2023 by Saudi Arabia (500 thousand b/d); Iraq (211 thousand b/d); United Arab Emirates (144 thousand b/d); Kuwait (128 thousand b/d); Kazakhstan (78 thousand b/d); Algeria (48 thousand b/d); Oman (40 thousand b/d); and Gabon (8 thousand b/d) starting May until the end of 2023. These will be in addition to the production adjustments decided at the 33rd OPEC and non-OPEC Ministerial Meeting,

“The above will be in addition to the announced voluntary adjustment by the Russian Federation of 500 thousand barrels per day until the end of 2023, which will be from the average production levels as assessed by the secondary sources for the month of February 2023.

“Accordingly, this will bring the total additional voluntary production adjustments by the above-mentioned countries to 1.66 million b/d.

“The Meeting noted that this is a precautionary measure aimed at supporting the stability of the oil market. The Committee thanked the OPEC Secretariat for their contribution to the meeting. The next meeting of the JMMC (49th) is scheduled for the 4th of June 2023.”

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