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CNBC
3 days ago
- Business
- CNBC
Oil prices pick up as OPEC+ holds oil quotas ahead of July production review
OPEC+ countries on Wednesday agreed to leave their formal output quotas unchanged, with market focus shifting toward potential increases from an eight-member subset of the alliance that had been carrying out separate voluntary production cuts. The OPEC+ coalition has been operating a spate of formal production agreements that bind all members unanimously, along with two output cuts that are only informally tackled by an eight-member subset of the organization. Under formal policy, the entire OPEC+ group is cutting roughly 2 million barrels per day until the end of 2026. On Wednesday, OPEC+ nations said they agreed to "reaffirm the level of overall crude oil production for OPEC and non-OPEC Participating Countries" as agreed during the alliance's December meeting. Separate from formal policy, OPEC+ heavyweight Russia and Saudi Arabia, alongside Algeria, Iraq, Kazakhstan, Kuwait, Oman and the United Arab Emirates, are also trimming production by 1.66 million barrels per day until the end of next year, under one opt-in agreement. Until the end of March, these eight members also implemented a second combined 2.2 million-barrel-per day voluntary production decline, which they have begun to gradually unwind in the months since. As of the latest announcements, these nations are set to bring back a combined roughly 1 million barrels per day of their previously cut volumes over April-June and will be assessing further production steps over the weekend. The timing of these hikes has coincided with increasing concern within the OPEC+ group that some members — which have in the past included the likes of Kazakhstan, Iraq and Russia — were not respecting their production quotas. "This group is doing its best, but it's not enough only this group, we need the help of others," UAE Energy Minister Suhail Mohamed al-Mazrouei said Tuesday in a World Utilities Congress panel moderated by CNBC's Dan Murphy. On Wednesday, OPEC+ nations called on the OPEC Secretariat to assess each country's sustainable production capacity to determine their baselines for 2027 — levels used to calculate coalition members' output quotas under OPEC+ agreements. OPEC+ members will next hold a ministerial meeting on Nov. 30. Oil prices were in positive territory shortly after the ending of the OPEC+ meeting. The Ice Brent contract with July expiry was at $65.06 per barrel at 4:30 p.m. London time, up 1.5% from the Tuesday close price. Front-month July Nymex WTI futures were trading at $61.96 per barrel, up 1.76% from the previous day's settlement. Oil demand typically spikes during the summer with the start of the travel season and additional crude burn to produce electricity for air conditioning needs in several Middle Eastern countries. In a note out earlier this week, UBS Strategist Giovanni Staunovo flagged a "closely balanced oil market" in the first quarter of this year, compared with a vast projected supply surplus. "We expect further demand and supply revisions with more incoming data," Staunovo said. "With demand seasonally rising and the eight OPEC+ member states with additional voluntary cuts likely still adding more barrels to the market in July, we look for oil prices to move sideways in a USD 60-70/bbl range over the coming months." The UAE's al-Mazrouei echoed this sentiment, flagging, "We need to be mindful of the demand. Demand is picking up. And demand is going to surprise us, if we're not investing enough."
Yahoo
03-04-2025
- Business
- Yahoo
8 OPEC nations boost crude oil production by 411,000 barrels a day
April 3 (UPI) -- Eight OPEC oil-producing nations Thursday agreed to boost crude oil production beginning in May. OPEC said in a statement that Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Algeria and Oman "reaffirmed their commitment" to voluntary production adjustments as they announced plans to boost production to a more-than-expected 411,000 barrels a day. "The gradual increases may be paused or reversed subject to evolving market conditions. This flexibility will allow the group to continue to support oil market stability," OPEC said in a statement. The move sent oil prices lower by 5.94% for Ice Brent which was at $70.50 a barrel in London trading. Nymex WTI prices were down 6.41% at $67.11 per barrel. The OPEC countries were expected to ramp up production by just under 140,000 barrels a day. They said this move will increase the compensation of the nations producing more oil. The added production is equivalent to three monthly increments of increases, according to OPEC. It comes as the 8 nations are ending a voluntary reduction in their crude oil output of 2.2 million barrels a day. The larger 22-member OPEC organization has a cut of 3.66 million barrels a day still in force through the end of 2026. Sign in to access your portfolio
NBC News
03-04-2025
- Business
- NBC News
Eight OPEC+ producers accelerate crude oil output hikes, pushing oil prices 6% lower
Eight key OPEC+ producers on Thuesday agreed to raise combined crude oil output by 411,000 barrels per day, speeding up the pace of their scheduled hikes and pushing down oil prices. The Ice Brent contract with June delivery was trading at $70.50 per barrel at 1:32 p.m. London time (8:32 a.m. ET), down 5.94% from the Wednesday close. The front-month May Nymex WTI contract was at $67.11 per barrel, 6.41% lower. Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Algeria, and Oman met virtually to review global market conditions and decided to raise collective output by 411,000 barrels per day, starting in May. The group was widely expected to implement an increase of just under 140,000 barrels per day next month. The May hike agreed on Thursday is 'equivalent to three monthly increments,' OPEC said in a statement, adding that 'the gradual increases may be paused or reversed subject to evolving market conditions.' The eight OPEC+ producers this month started gradually unwinding 2.2 million barrels per day of voluntary cuts undertaken independently from the production strategy of the broader 22-member OPEC+ alliance, which has roughly 3.66 million barrels per day of separate cuts in place until the end of 2026. The Thursday meeting was the first one attended by Erlan Akkenzhenov, the new energy minister of Kazakhstan, which has struggled with producing above its assigned quota. Without referencing individual countries, OPEC said in its Thursday statement that the May output hike will 'provide an opportunity for the participating countries to accelerate their compensation' by way of additional production cuts in line with overproduction. The Thursday decision was taken against the backdrop of broader market tumult triggered by sweeping tariffs on key trade partners unveiled on Wednesday by the administration of U.S. President Donald Trump, who has been simultaneously championing higher U.S. oil output.
