Member states of the Organization of Petroleum Exporting Countries (OPEC), together with ten other large non-member producers (OPEC+), an alliance led by Saudi Arabia and Russia, agreed this Wednesday that they will increase their production to 400,000 barrels per day (bd) in March. of the crude.
OPEC projects increase in oil production
The 23 Oil Ministers decided in a virtual meeting “to adjust monthly global production upwards by 400,000 barrels per day in the month of March 2022,” according to a final statement of the meeting.
Analysts expected that OPEC + would start producing more to reduce the prices of crude oil that began to rise in the markets and their values have not fallen below the maximum since 2014.
Faced with a tighter supply, greater demand and the difficult situations for production faced by some producing countries, prices have skyrocketed. Brent, which is a European benchmark, WTI, which is a benchmark in the US, and OPEC is trading at more than 90 dollars.
The United States repeatedly asked the oil alliance to increase its production to reduce costs.
OPEC+ is made up of the 13 producing member countries of the initial alliance together with ten allied producers. The next meeting is scheduled for March 2, again online.
The increase in oil production agreed this Wednesday is in accordance with the OPEC+ agreement of July 2021 with the aim of gradually recovering, until September 2022, the flow that the group had prior to the Covid-19 pandemic.
For the moment, the agency has stuck to that plan of moderate monthly increases of 400,000 barrels per day, in order to cautiously face the uncertainty of the energy market, especially in the framework of the global health crisis.
In this way, the large cut of 9.7 million barrels per day has been reduced, approximately ten percent of world production, applied in May 2020 with a view to compensating for the historical collapse in demand and crude oil prices that It happened that year with the coronavirus situation.
In December, the total volume of the pact added its production to 90,000 barrels per day, below its objective of 400,00 barrels, according to international press agencies.
Strong geopolitical tensions have also affected oil production and exports, as has been the case with Russia, Saudi Arabia and the United Arab Emirates, so supply has suffered a shock.
Especially, Moscow has experienced tensions with Western countries after their military expansion in the Ukraine border area, escalating the conflict to maximum levels.