The new decision to extend the OPEC+ agreement on reducing oil production will ensure the positive dynamics in oil prices, Report informs, citing economist-expert Mansur Barkhudarov, who was commenting on the agreement, reached at the 14th meeting of OPEC+ ministers on preserving existing quotas on daily oil output in April.
According to him, the deal will help further stabilize the oil prices: "The coronavirus pandemic has caused many complications in the world economy. The oil sector also got a significant share of this turmoil. For the first time in history, prices went negative. In such conditions, the regulation of production acquires a greater importance than ever. The OPEC+ deal assumed this function, and after a short time, the market was stabilized to some extent."
The expert noted that oil price stability is an important aspect, especially for countries where a significant part of budget revenues is formed from revenues in the oil sector.
"As is known, our country has recently fully restored its territorial integrity, thereby increasing the scale of the great return plan announced by our state a few years ago. The construction of new roads, airports in line with the highest global standards and their speedy implementation require significant investment.Therefore, that our country is a part of this agreement is very important in terms of the sustainability of revenues," he said.
At their 12th meeting in December last year, the Ministers of the Organization of the Petroleum Exporting Countries (OPEC) agreed to increase the daily oil output by 0.5 million barrels in January 2021 and to gradually reduce quotas to 2 million barrels in the coming months through OPEC+ meetings held every month. In this context, at the 13th meeting of OPEC+ ministers in January 2021, it was decided to reduce daily oil production by 7,125,000 barrels in February and 7,050,000 barrels in March.
According to the new decision, Azerbaijan's commitment in April will remain at 123,000 barrels, just like in the first quarter of this year. Daily crude oil production will remain at 595,000 barrels in April. The cuts in daily crude oil production of the OPEC+ countries will reach 6.9 million barrels in April.