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Oil: to stabilize prices, OPEC+ extends voluntary production cuts

Oil: to stabilize prices, OPEC+ extends voluntary production cuts

The measure, intended to support the stability and balance of oil markets, is based on the need to maintain a production level in line with projections for the year 2024.

This cut is in addition to the commitment previously established in April 2023, extended until the end of December 2024, based on the average export levels of the months of May and June 2023, as explained by OPEC.

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Oil prices barely experienced significant changes this Monday, remaining stable after the expected OPEC+ decision to extend voluntary production cuts until mid-year. According to the information provided in the March 3 press release, various member countries of the Petroleum Group have agreed to continue with additional production reductionscommitting to decrease by 2.2 million barrels per day during the second quarter of 2024.

The measure, intended to support the stability and balance of oil markets, is based on the need to maintain a level of production in line with the projections for the year 2024, established during the 35th OPEC+ Ministerial Meeting in June 2023. These cuts are in addition to actions previously announced in April 2023, which were extended until the end of 2024.

OPEC+: the countries that announced cuts

Among the countries that reported additional cuts for the second quarter of 2024 are Saudi Arabiawith a reduction of one million barrels per day, followed by Iraq (220,000 barrels per day), United Arab Emirates (163,000 barrels per day), Kuwait (135,000 barrels per day), Kazakhstan (82,000 barrels per day), Algeria (51,000 barrels per day) and Oman (42,000 barrels per day), as reported by the organization.

OPEC assured that these voluntary cuts will be reversed gradually, adapting to market conditions. In addition, it highlights the commitment of the Russian Federation, which announced an additional voluntary cut of 471,000 barrels per day for the same period, applying reductions in both production and exports during the months of April, May and June 2024.

This cut is in addition to the commitment previously established in April 2023, extended until the end of December 2024, based on the average export levels of the months of May and June 2023, as explained by OPEC. ANDTogether, these measures seek to contribute to stability and sustainable balance in global oil markets.

Source: Ambito

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