OPEC+ ministers to review oil cuts on Thursday

An OPEC+ ministerial panel begins talks at 1200 GMT on Thursday to review the progress of a record oil supply cut and discuss plans from countries yet to deliver their share in full on how they propose to comply. Report informs citing the Reuters.

The Organization of the Petroleum Exporting Countries and allies, known as OPEC+, have been cutting output by a record 9.7 million barrels per day (BPD) since May 1.

OPEC+ agreed on June 6 to extend those cuts for another month until the end of July to further support the market.

The level of cuts is due to ease after July, and two OPEC+ sources said that Thursday’s virtual meeting of the Joint Ministerial Monitoring Committee (JMMC), which advises OPEC+, was unlikely to recommend extending record cuts into August.

“Unlikely, but let’s see,” an OPEC source said, adding that the panel would also decide the date of its next meeting, scheduled to take place in July when the levels of cuts from August onwards would be discussed again.

Oil has recovered to above $41 a barrel from a 21-year low below $16 a barrel in April, helped by the supply cut and a recovery in demand due to an easing of government lockdowns imposed to contain the spread of the virus.

OPEC+ technical experts, who met on Wednesday, made no recommendation on further extending the cut and focused on production levels and compliance, OPEC+ sources said.

Two OPEC + sources said both Iraq and Kazakhstan are expected to present their plans for production cuts and compensation for overproduction to the JMMC.

Both nations were among those that did not deliver their cuts in full last month. Even so, overall, OPEC+ compliance with the existing crude production cuts in May was a strong 87%, two OPEC+ sources said on Wednesday.

The JMMC is composed of OPEC members Algeria, Kuwait, Venezuela, Nigeria, Iraq, United Arab Emirates, Saudi Arabia, and non-OPEC countries, Russia and Kazakhstan.