LONDON/DUBAI: OPEC+ agreed on Sunday to prolong its deep oil output cuts in 2024 and was discussing extending them into 2025, OPEC+ sources said as the group seeks to shore up the market amid tepid global demand growth, high interest rates and rising rival U.S. production.
Oil prices trade near $80 per barrel, below what many OPEC+ members need to balance their budget. Worries over slow demand growth in top oil importer China have weighed on prices.
The Organization of the Petroleum Exporting Countries and allies led by Russia, together known as OPEC+, have made a series of deep output cuts since late 2022.
OPEC+ members are currently cutting output by a total of 5.86 million barrels per day (bpd), or about 5.7% of global demand.
OPEC+ set to decide oil output policy for 2024, possibly into 2025
The cuts include 3.66 million bpd by OPEC+ members valid through to the end of 2024, and 2.2 million bpd of voluntary cuts by some members which expire at the end of June.
On Sunday, OPEC+ agreed to extend voluntary cuts of 2.2 million bpd into the third quarter of 2024, two OPEC+ sources said.
Talks about cuts for the fourth quarter and 2025 continue, the sources said. Sources said earlier that the group may extend some of the cuts of 3.66 million bpd into 2025.
The countries which have made voluntary cuts that are deeper than those agreed with the wider group are Algeria, Iraq, Kazakhstan, Kuwait, Oman, Russia, Saudi Arabia and the United Arab Emirates.
The group will have a series of online and in person meetings on Sunday, which began at around 0930 GMT with a meeting of OPEC ministers only.
Several key ministers – mainly from countries which have made voluntary cuts – flew to Saudi Arabia’s capital Riyadh, OPEC+ sources said. Other ministers will join online.
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