OPEC+ agreed during its meeting on Sunday to extend most of the oil production cuts to continue in 2024 and to begin gradually retracting them in 2025. The group seeks to support the market amid the sluggish growth in global demand, high interest rates and increased US production.
The group, which includes the Organization of the Petroleum Exporting Countries (OPEC) and its allies, has adopted a series of production cuts since late 2022.
The total cuts by OPEC+ members currently amount to 5.86 million barrels per day, equivalent to about 5.7% of global demand.
The cuts include two million barrels per day from all OPEC+ member states, a 1.66 million barrels per day voluntary reduction from nine member states, and a 2.2 million barrels per day voluntary reduction from eight member states.
OPEC+ said it extended the first round of cuts to the end of 2025 instead of 2024.
OPEC+ extended the deadline for the independent assessment of the production capacity of member countries until the end of November 2025 from June 2024. These assessments will be used as a reference for production levels in 2026.
OPEC+ is scheduled to hold its next meeting on December 1, 2024.
Oil prices are currently hovering near $80 per barrel, which is less than what many OPEC+ members need to balance their budgets. Prices are affected by fears of slow growth in demand in China, the largest importer of crude.
