American Invest Hub
  • Politics
  • Investing
  • Business
  • Latest News

American Invest Hub

  • Politics
  • Investing
  • Business
  • Latest News
Latest News

OPEC puts off output hike till March-end, extends overall cuts till end of 2026

by admin December 6, 2024
December 6, 2024

The Organization of the Petroleum Exporting Countries and its allies on Thursday extended the voluntary crude oil production cuts of 2.2 million barrels per day till the end of March due to poor demand. 

The cartel held a ministerial-level meeting with its allies on Thursday via videoconference. 

OPEC in an official release also said it will extend overall production cuts other than the 2.2 million barrels per day of voluntary reductions till December 31, 2026. 

The voluntary cuts of 2.2 million barrels by eight members, including Saudi Arabia and Russia, were set to expire on December 31 of this year. 

The cartel has extended these cuts since June, when it was originally set for expiration. 

At the time of writing, the price of West Texas Intermediate crude oil was at $68.30 per barrel, down 0.3% from the previous close. Brent crude was down 0.2% at $72.14 per barrel. 

Steep production cuts

OPEC and its allies have been withholding around 5.86 million barrels per day of crude oil from the market in a series of cuts since 2022. This translates to about 5.7% of global oil supply. 

Total production cuts include 2 million barrels per day of reductions by the whole group and 1.65 million barrels per day by eight members of the OPEC+ alliance. On top of these, another 2.2 million barrels per day of voluntary cuts by the same eight members had been in place since the start of 2024. 

The gradual unwinding of 2.2 million barrels per day of voluntary output cuts will begin from April and will run through September 2026, OPEC said in the release. 

The first two cuts of 2 million barrels per day and 1.65 million barrels per day were extended by a year till the end of 2026. 

Source: OPEC

OPEC was initially scheduled to raise output by 180,000 million barrels per day by unwind some of the 2.2 million barrels per day of reductions from December. 

Meanwhile, the cartel said production quota for the United Arab Emirates have been increased by 300,000 barrels per day. UAE had raised its production capacity and was set to increase output from 2025.

The production increase for UAE will be gradually phased in from April next year through September 2026.

Oversupply concerns

Thursday’s decision by OPEC+ was largely in line with market expectations. 

Analysts with Commerzbank AG had earlier said that the cartel may extend production cuts by three months till the end of March as oversupply concerns weighed on oil prices. 

Oil prices have struggled to break out of a narrow range for most of the year despite steep production cuts by OPEC. Brent crude oil prices have stayed in a narrow bandwidth of $70-$80 for most of 2024. 

Most countries within the OPEC+ group want oil prices above $80 per barrel, which is the breakeven price for them. 

Poor demand from top importer China, and rising production in non-OPEC countries, particularly the US, had increased concerns about a glut in 2025. 

Still, the International Energy Agency expects the market to be flooded with excess crude oil even without production increases by OPEC in 2025. 

IEA said earlier that supply from non-OPEC countries, led by the US, is likely to rise by 1.5 million barrels per day next year. It expects overall global demand to grow below 1 million barrels per day next year. 

In the absence of a production increase for at least the next three months, the focus will now shift to US President-elect Donald Trump’s policies for the oil and gas sector. 

Trump had been vocal about his support for boosting oil and gas production in the US, and is also likely to roll back several climate regulations in the US. 

The post OPEC puts off output hike till March-end, extends overall cuts till end of 2026 appeared first on Invezz

0
FacebookTwitterGoogle +Pinterest
previous post
Chinese stocks rally on stimulus expectations, offsetting declines in Japan and South Korea
next post
SNAP stock is troubled, but a major comeback can’t be ruled out

Related Posts

Nigeria’s oil-rich Rivers State makes moves to become...

May 26, 2024

Ukraine says it sank Russian warship off coast...

February 2, 2024

Thousands stranded by floods in Philippine capital as...

July 25, 2024

‘We cannot remain silent about what we saw.’...

July 27, 2024

Scientists spot ‘glory effect’ on a world beyond...

April 21, 2024

China tightens critical metals export curbs as Trump’s...

February 4, 2025

German citizen sentenced to death in Belarus, charged...

July 21, 2024

Ecuadorians head to polls for referendum as Noboa...

April 23, 2024

NIO, XPeng, and other Chinese EV stocks surge...

March 11, 2025

UK lawmaker who lost four limbs to sepsis...

May 24, 2024

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Latest News

    • Interview: Strategic location gives Brazil Potash cost advantage in domestic fertiliser market, says CEO Matt Simpson

      June 1, 2025
    • Canada’s Q1 GDP expands by 2.2%, driven by exports spike ahead of potential US tariffs

      June 1, 2025
    • President Trump to host farewell for Elon Musk as DOGE leader steps away

      June 1, 2025
    • UK’s digital banks face divergent fortunes: Starling stumbles, Monzo and Revolut soars

      June 1, 2025
    • Trump wants Apple to shift iPhone production from India to the US: here’s what it means

      May 18, 2025

    Categories

    • Business (3,022)
    • Investing (2,459)
    • Latest News (1,994)
    • Politics (1,530)
    • About us
    • Contact us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: americaninvesthub.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 americaninvesthub.com | All Rights Reserved