Opec-Plus Buys Time to Ponder Future Policy

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Opec-plus has bought more time to come up with a production plan for when its current deal expires in September. But it's anyone's guess how the producer alliance proceeds from here given the huge amount of uncertainty in global oil markets. The current deal succeeded in working off surplus inventories from the pandemic. But the challenge now — taming runaway prices — may be greater due to tricky politics and limited spare capacity, as alliance heavyweight Russia is at war and under sanctions, while high oil prices are fueling inflation and threatening global demand. Opec-plus ministers on Jun. 30 decided to stay the course and add 648,000 barrels per day to production in August — as agreed in the previous meeting. Many Opec-plus members have regularly failed to meet their allotted production quotas — especially Angola, Nigeria and Malaysia — and the actual increase will be perhaps just half the agreed volume. Compliance with agreed cuts has shot up to a meaningless 250% or so, and Energy Intelligence reckons the group could be short of targeted levels by around 4 million b/d by end-August.

Opec-Plus Supply , Crude Oil, Oil Prices, Oil Forecasts, Oil Inventories
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