OPEC drastically reduced oil production in May, in line with commitments
AFP published on June 17, 2020
The production of the Organization of the Petroleum Exporting Countries (OPEC) fell spectacularly in May, the member countries of the cartel uniting for the moment behind the agreement found within OPEC + to support the prices of l gold, depressed by the Covid-19 crisis.
Their production fell by 6,3 million barrels per day (Mb / d) over a month to reach 24,195 Mb / d in May, according to secondary (indirect) sources cited by OPEC in its monthly report, released Tuesday. These secondary sources, based on a set of data such as tanker traffic, refining statistics or confidential information, are those which are used to assess the production of black gold.
Saudi Arabia, the leader of the organization, provided just over half of this effort alone: its black gold extractions fell 3,16 Mb / d over a month. The United Arab Emirates (- 1,364 Mb / d) and Kuwait (- 921 barrels per day) also pumped much less last month to support prices.
OPEC members and their allies, including Russia, agreed earlier this month to extend the historic drop in production to which they have been operating since May 1 in July. This drop is intended to support falling prices because of the Covid-19 health crisis, which resulted in a collapse in demand, especially for transport.
OPEC also estimates that the 10 countries not members of the cartel but associated with the effort also reduced their production by 2,95 million barrels per day last month. In total, the allies would have reduced their production by some 9,2 Mb / d.
The Vienna-based organization notes in passing "the high level of compliance with voluntary production adjustments" on the part of its partners within the larger group known as OPEC +. Besides Russia, it includes countries such as Azerbaijan, Kazakhstan, Mexico and the Sultanate of Oman.
With the efforts of these countries, but also the resumption of economic activity which encourages demand, prices have increased recently after having collapsed during the health crisis. North Sea Brent was worth just over $ 40 a barrel on Wednesday morning, when it fell below $ 20 in April.
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