The Organization of Petroleum Exporting Countries (OPEC) and allies, has agreed to cut production by 100,000 barrels per day (bpd) in October.
The 23 members of the group held the 32nd ministerial meeting via video-conference to discuss the production volume for October.
The group pointed to the adverse impact of volatility and the decline in liquidity on the current oil market, and noted the need to support the stability and efficient functioning of the market.
OPEC+ expressed readiness to guide the market as “higher volatility and increased uncertainties require continuous assessment of market conditions.”
The group vowed to consider calling a ministerial meeting if needed to address market developments.
OPEC+ reduced daily crude oil production by approximately 10 million barrels in April 2020 due to the sharp decline in demand following the emergence of the COVID-19 pandemic.
As global economies and oil demand started to recover, the group also began to ease these cuts incrementally from April 2021. The next meeting of OPEC and non-OPEC members is scheduled for Oct. 5.
Meanwhile European gas prices jumped as much as 30 percent on Monday following Russia’s announcement that it is shutting off natural gas exports to the continent through its Nord Stream 1 pipeline indefinitely,
Russia’s state energy provider, Gazprom, claims it is shutting down the pipeline due to an oil leak that needs to be repaired, though European leaders have accused Moscow of squeezing gas supplies “in retaliation against sanctions imposed after its invasion of Ukraine,” The Guardian explains, adding that “the threatened cuts to supplies of gas from Russia have prompted a scramble by European countries to store as much gas as possible before winter, as well as efforts to find alternative supplies.”
The Nord Stream pipeline normally supplies more than a third of the gas exported to Europe from Russia, though it had already been running at a much lower capacity before the Friday announcement. “Supply is hard to come by, and it becomes harder and harder to replace every bit of gas that doesn’t come from Russia,” Jacob Mandel, senior associate for commodities at Aurora Energy Research, told Reuters.
