Set at 6.9 million bpd for April, the total of quotas will dip to 6.6 million bpd in May, 6.2 million bpd in June and 5.8 million bpd in July (in rounded off figures).
Among OPEC numbers, the largest declines will be for Saudi Arabia – set at 8.1 million bpd for February, March and April (with due account for the voluntary production cut of 1 million bpd) and it will rise in July to 9.5 million bpd. In comparison with April quotas, serious cuts are also to be made for Iraq (159,000 bpd), the United Arab Emirates (109,000 bpd), Kuwait (96,000 bpd) and Nigeria (63,000 bpd). In total, for 10 OPEC member-countries, reduction quotas will be cut by 914,000 bpd.
The easing will also apply to nine “external” deal participants (not including Mexico). And not just Kazakhstan and Russia, whose production cuts will be set at 18,000 bpd and 116,000 bpd, but also Azerbaijan (25,000 bpd), Malaysia (21,000 bpd), Oman (30,000 bpd) and four other countries – Bahrain (7,000 bpd), Brunei (3,000 bpd), Sudan (3,000 bpd) and South Sudan (4,000 bpd). In total, from April to July, the quotas for the other half of the alliance will be reduced by 227,000 bpd.
By the same token, over the next three months, the reduction quotas for the cartel and the countries allied with them will be reduced by more than 1.1 million bpd. Added to the January rise in production of 500,000 bpd and the alliance’s March decision to allow Kazakhstan and Russia to increase production by 150,000 bpd from April, the result will be a cut in reduced production quotas of 1.8 million bpd when compared to levels in effect from August to December.
The original plan under the terns of the agreement was for the alliance to take such a step in January. In the event, the shift was put back for another six months.
The need, at long last, to allow for significantly higher production levels within the alliance was apparently prompted by increased supply from countries outside the agreement.
“On the supply side, non-OPEC liquids for 2021 are forecast to grow by almost 1 million bpd, compared to expectations of 0.7 million bpd at our last meeting,” Mohammad Sanusi Barkindo, OPEC Secretary General, said on Thursday in comments appearing on the OPEC website.