The OPEC + group decided on Wednesday to impose another 400,000 barrels per day (bpd) increase in its total oil production in April, despite rising oil prices after a key member of the pact, Russia, invaded Ukraine.
During a brief OPEC + ministerial meeting, ministers decided to continue with the monthly increase agreed last summer, in a move widely expected by analysts.
In the days leading up to the meeting, OPEC + sources and analysts signaled that there would be no change in the pact’s production plan, despite soaring oil prices, which are now well beyond those comfortable for major oil-consuming countries, including the United States.
The problem with increasing production more than planned – even if OPEC + wanted – is that only Saudi Arabia and the UAE actually have the capacity to do so, but a large increase in production by these two influential OPEC members would mean a critical reduction in reserve production capacity. world Wide. Others most often do not have the capacity to pump their quotas, and the gap between the monthly nominal increase of 400,000 barrels per day and the actual increase rises to as much as 900,000 bpd in January, according to the International Energy Agency.
The OPEC + meeting on Wednesday decided to leave the plan as it is and did not mention the Russian war in Ukraine, which was the reason why oil prices jumped to over $ 100 a barrel last week for the first time since 2014 and continued. to Grow $ 111 Early Today.
OPEC + said in a press release after a record brief meeting that “it was noted that the current fundamentals of the oil market and the consensus on its prospects point to a well-balanced market and that the current instability is not caused by changes in market fundamentals but by current geopolitical developments. . “
According to the production schedule for April provided by OPEC, the collective quota of the OPEC + alliance is 41.697 million barrels per day. The pact’s leaders, Saudi Arabia and Russia, have a quota of 10.436 million barrels a day in April.
Oil prices continued to rise, with Brent reaching $ 112 and crude oil WTI $ 110 a barrel half an hour after OPEC + closed.
By Tsvetana Paraskova for Oilprice.com
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