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The OPEC + group met 101% of October’s oil production cuts, maintaining a high level of compliance ahead of the crucial meetings over the next two weeks, which will decide whether the alliance will reverse the course on easing the cuts given the worsening of demand prospects.
Compliance last month was estimated at 101%, three OPEC + sources told Reuters on Friday.
This assessment is subject to official review by the OPEC + Joint Technical Committee (JTC), which meets on Monday, November 16, one day before the monthly meeting of the Joint Ministerial Monitoring Committee (JMMC) scheduled for Tuesday.
In September, the overall compliance of OPEC + pact participants was 102 percent, the highest since May 2020, the JMMC said after the October meeting, when it urged full compliance with the quotas and “reminded everyone. participating countries need to be vigilant and proactive given the precarious market conditions and prospects “.
Market conditions and outlook became even more precarious in the month following the mid-October meeting as major European economies reset various forms of lockdowns and curfews to combat the renewed spike in COVID-19 cases. Earlier this week, OPEC downgraded its expectations for global oil demand – its fifth consecutive downward revision – as the resurgence of the coronavirus is slowing the recovery in oil demand.
The slowdown in the recovery in demand and the increase in production among Libya, an exempt OPEC member, after an eight-month port blockade, is prompting the OPEC + group to reconsider its plans to ease current cuts of 2 million. barrels per day in January.
Next week’s JMMC meeting does not have the authority to change a deal, but it can recommend action at the entire OPEC + meeting scheduled for December 1, with an OPEC meeting scheduled for November 30.
OPEC + is now considering a three to six month delay for the originally planned ramp-up, while a deeper cut option has failed to gain much traction, delegates told Bloomberg this week.
Curated by Charles Kennedy for Oil “
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