OPEC+ extends oil output cuts into 2025

The Vienna-headquartered group on Sunday agreed to extend most of its voluntary oil production cuts into 2025 to "support the stability and balance of oil markets.”

PHOTO: Logo of the Organization of the Petroleum Exporting Countries. Getty Images

Several members of the OPEC+ coalition including Saudi Arabia, Russia, Iraq, the UAE, Kuwait, Kazakhstan, Algeria, and Oman have decided to extend their combined production cut of 2.2 million b/d by three months until the end of September 2024.

This voluntary supply cut of 2.2 million b/d was initially announced in November 2023 and was set to expire at the end of June this year.

Oil market analysts largely anticipated the output cut extension as the coalition seeks ways to bolster oil prices and support the market which currently seems fragile.

However, the coalition has decided to gradually phase out these cuts on a monthly basis between October 2024 and September 2025.

The member countries also pledged to extend the combined output cut of 1.65 million b/d which was announced in April 2023, until the end of December 2025.

The group can pause or reverse these cuts depending on the market conditions, it said.

It also agreed to gradually increase the UAE’s output quota by 300,000 b/d from the current level of 2.9 million b/d. "This increase will be phased in gradually starting January 2025 until the end of September 2025," OPEC said in a statement released after the in-person OPEC and non-OPEC Ministerial Meeting (ONOMM) in Riyadh.

Besides, Iraq, Russia, and Kazakhstan will submit their respective compensation plans by the end of this month for surpassing their production quotas this year, the OPEC secretariat said.

The coalition will next meet to discuss output policies on 1 December 2024.

By Aparupa Mazumder 

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