OPEC fulfills oil production cut deal in December by 167%

OPEC crude oil production in December increased by 91 tb/d m-o-m to average 28.97 mb/d. However, the countries of the organization, despite the reduction in the quota, again produced oil below the levels allowed under the OPEC+ deal, fulfilling the agreement by 167 percent, Report informs referring to the organization’s January report.

“According to secondary sources, total OPEC-13 crude oil production averaged 28.97 mb/d in December 2022, higher by 91 tb/d m-o-m. Crude oil output increased mainly in Nigeria, Angola, Libya and Venezuela, while production in Kuwait, Congo and Algeria declined,” reads the report.

Ten out of thirteen OPEC countries have commitments under the OPEC+ agreement, which were supposed to reduce production in December by 1.273 million barrels per day from the level of August, but the actual reduction amounted to 2.127 million barrels. Thus, in December, OPEC completed the deal by 167%, reducing production by 854,000 barrels per day more than planned.

The OPEC+ alliance cut oil production by 9.7 million barrels per day in May 2020 due to a drop in oil demand caused by the pandemic. Then the terms of the agreement were repeatedly adjusted.

Under the terms for September, the OPEC+ alliance increased production by 100,000 barrels per day, and in October it reduced by the same volume and was supposed to return to August levels. In November-December, OPEC+ reduced production by 2 million barrels per day from the August level, in 2023 it continues to follow the same parameters.

At the same time, a number of OPEC+ countries, due to a natural decline in production, technical issues or external restrictions, are still unable to increase production to the allowed level.