OPEC+ has agreed to delay plans to raise oil output until April from January 2025 and the group will also take one extra year to fully unwind the cuts by the end of 2026, OPEC sources said.
OPEC+, which pumps about half the world's oil, had been planning to start unwinding cuts from October 2024 but a slowdown in global demand and rising output outside the group forced it to postpone the plans on several occasions.
RELATED
Adkins: Saudi Cuts to Stay, EVs are Overrated and China Matters Less
OPEC+ groups the Organization of the Petroleum Exporting Countries and allies such as Russia. It started online talks on Dec. 5 at 1100 GMT and talks were still ongoing by 1230 GMT.
Despite the group's supply cuts, global oil benchmark Brent crude has mostly stayed in a $70/bbl to $80/bbl this year and on Dec. 5 traded near $73/bbl, having hit a 2024 low below $69 in September.
OPEC+ members are holding back 5.86 MMbbl/d of output, or about 5.7% of global demand, in a series of steps agreed since 2022 to support the market.
The steps include cuts of 2 MMbbl/d by the whole group, 1.65 MMbbl/d of first stage of voluntary cuts by eight members and another 2.2 MMbbl/d of second stage of voluntary cuts by the same eight members.
On Dec. 5, OPEC agreed to extend the 2 MMbbl/d and the 1.65 MMbbl/d cuts until the end of 2026 from the end of 2025, the sources said.
The gradual unwinding of 2.2 MMbbl/d of cuts will start from April 2025 and will last until September 2026.
The group also agreed to allow the United Arab Emirates to raise output by 300,000 bbl/d from April and until the end of September 2026, instead of the earlier plan to start it in January 2025.
Recommended Reading
Ring Energy Bolts On Lime Rock’s Central Basin Assets for $100MM
2025-02-26 - Ring Energy Inc. is bolting on Lime Rock Resources IV LP’s Central Basin Platform assets for $100 million.
Talos Sells More of Mexican Subsidiary to Billionaire Carlos Slim
2024-12-17 - Talos Energy has agreed to sell another 30.1% interest in subsidiary Talos Mexico to entities controlled by billionaire Carlos Slim, whose companies also own at least 24% of Talos Energy’s common stock.
Battalion Oil Walks Away from Fury Resources Buyout
2024-12-20 - The Battalion Oil-Fury Resources merger had been in discussions for more than a year, but Battalion said Fury failed to meet financial deadlines to continue the talks.
TPG to Buy Solar Company Altus Power, Take Private in $2.2B Deal
2025-02-06 - TPG's all-cash acquisition, being made through the TPG Rise Climate Transition Infrastructure strategy, takes the public company Altus Power private at a 66% premium to the company's Oct. 15 share price.
Constellation Bets Big on NatGas in $16.4B Deal for Calpine
2025-01-10 - Constellation Energy will acquire Calpine Corp. in a $26.6 billion deal, including debt, that will give the pure-play nuclear company the largest natural gas power generation fleet.
Comments
Add new comment
This conversation is moderated according to Hart Energy community rules. Please read the rules before joining the discussion. If you’re experiencing any technical problems, please contact our customer care team.