OPEC + will physically meet this Wednesday in Vienna, headquarters of the oil producers cartel, “for the first time since March 2020” and the emergence of the Covid-19 pandemic, the alliance announced this Saturday in a press release. Representatives of the thirteen members of the Organization of Crude Exporting Countries (OPEC), led by Saudi Arabia, and its ten allies led by Russia, meet amid rumors of major production cuts amid fears of recession.
As the economic picture darkens, and with it oil demand, the murmurs intensify. The two global crude benchmarks have both fallen sharply since the last meeting in September, hovering around $80, well below March highs, at $139.13 for North Sea Brent and $130.50 for North Sea Brent. for WTI, at the beginning of the war in Ukraine.
volume acceleration
Before the pandemic, the producers met twice a year in the Austrian capital. But since the spring of 2020, the 23 members meet every month, by videoconference, to better hone their goals in the face of volatility in demand. In the spring of 2020, they had voluntarily left millions of barrels underground so as not to flood the market with oil that they could not absorb due to lockdowns and sanitary restrictions.
The recipe worked: prices, which fell into negative territory in the spring of 2020, rose again under the effect of this policy. Calm returned, OPEC + then decided to increase production again last year. But faced with fears of a recession, the alliance had opted in early September for a reduction in volumes, which it could therefore choose to speed up.
Source: BFM TV
