The photo is sourced from encyclopedie-energie.org
Despite the fact that the level of the oil production cut for Brazil has not been determined, its OPEC+ accession may significantly improve the alliance’s position in the global oil market in general, and in the American market in particular.
As of today, Brazil produces about 3.7 mbpd. However, the country intends to actively develop its oil production. According to Wood Mackenzie, by 2026 already, Brazil may increase the production up to 5 mbpd, and by 2030 году – up to 5.3 mbpd. The majority of oil production projects of Brazil are offshore ones. China is the key importer of Brazilian petroleum products. The effect of participation in OPEC+ for the national economy is not quite clear yet.
Another significant decision of the OPEC+ countries was the consensus about the oil production cut to be introduced before the end of Q1 2024. Overall, these countries will reduce their oil production by circa 2 mbpd before the end of Q1 2024.
Saudi Arabia will continue to abide by the reduction level of 1 mbpd. Russia will decrease export of oil by 300 kbpd, and of petroleum products – by 200 kbpd.
Other OPEC+ countries except for Kongo and Nigeria will decrease their oil production by approximately 700 kbpd. For Iraq this will be a reduction by 211 kbpd, i.e., down to 4 mbpd. For the UAE this reduction will make 163 kbpd, i.e., down to 2.912 mbpd; for Oman – 42 kbpd, i.e., down to 759 kbpd; for Kuwait – 135 kbpd, i.e., down to 2.413 mbpd; for Algeria – 51 kbpd, i.e., down to 908 kbpd; for Kazakhstan – 82 kbpd, down to 1.468 kbpd.
Angola’s quota for 2024 is 1.1 mbpd, even though the earlier plan was to have the production volume of 1.28 mbpd. This decision to reduce the quota was underpinned by the analytical agencies’ reports not confirming the capabilities for stepping up the oil production in this African country.
Azerbaijan’s quota within the OPEC+ deal for 2024 will stay at the level of 551 kbpd.
Kongo was allowed to increase the oil production by 1 kbpd, i.e., up to 277 kbpd, and Nigeria – by 120 kbpd, i.e., up to 1.5 mbpd.
Alexader Novak, Deputy Prime Minister of Russia, explained in his interview to Russia-24 TV channel: “These decisions were focused, first of all, at mitigating the risks associated with the low demand period”.
“In future, to support the market stability these additional reductions will be gradually cancelled and the volumes will get back to the markets with the pace determined by the market situation”, the Russian Vice-Premier assured.
The next meeting of the OPEC+ ministers is scheduled for 1 June 2024. It will be a physical presence meeting in Vienna.
