VIENNA (WAM)

The OPEC+ countries have agreed to extend their additional voluntary production cuts of 2.2 million barrels per day for two months until the end of November 2024.

This came as these countries that previously announced additional voluntary cuts in April and November 2023, including the United Arab Emirates, Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman, held a virtual meeting on Thursday, 2024, during which the eight member countries emphasised their collective resolve to ensure full compliance with the voluntary production adjustments.

In recognition of this strengthened resolve and renewed firm commitment, the eight participating countries have agreed to extend their additional voluntary production cuts of 2.2 million barrels per day for two months until the end of November 2024, after which these cuts will be gradually phased out on a monthly basis starting December 1, 2024, with the flexibility to pause or reverse the adjustments as necessary.

The overproducing countries also reconfirmed their commitment that the entire overproduced volume will be fully compensated for by September 2025.

In August 2024, Saudi Arabia, Russia, the United Arab Emirates, Kuwait, Algeria, and Oman, conducted two ministerial discussions with Iraq and Kazakhstan. Both countries were urged to achieve full conformity and compensate for the overproduced volumes since January 2024. Iraq and Kazakhstan committed to engage with secondary sources to outline their plans for production adjustments to achieve compliance and meet the compensation schedules they submitted to the OPEC Secretariat on August 22.

The group includes Iraq and Kazakhstan, who have overproduced since January 2024, but have strongly reaffirmed their commitment to the agreement and to their compensation schedules submitted to the OPEC Secretariat as agreed under the 53rd meeting of the JMMC on 3rd April 2024.

Iraq and Kazakhstan reinforced their commitment during the OPEC Secretary General’s visits in late August, conducted in coordination with Saudi Arabia's Minister of Energy and the Chairman of the OPEC and non-OPEC Ministerial Meetings. During those visits, the OPEC Secretariat organised workshops with the secondary sources where both countries provided extensive details on the immediate and concrete measures, they are implementing to achieve full conformity with the required production levels and to meet their compensation schedules for August and for September. These measures included advancing field maintenance plans and reducing production alongside with delaying and cancelling spot sales for the month of August. Moreover, the countries committed to adjust compensation plans for any over produced volumes in August.