OPEC remains the world’s largest oil producer, despite many differences over its future, and many global energy equations are heavily dependent on its decisions. In this report, we will refer to the evaluation of the performance of OPEC members and other factors influencing the oil market. Please be with Artan Press.
*** OPEC agrees to continue reducing oil production
OPEC and its allies agreed on Thursday to cut crude oil production by 350,000 barrels per day in May and June to 450,000 barrels per day in July. Non-OPEC, via video conference on Saturday, agreed to increase crude oil production by 350,000 barrels per day in May and June and by 450,000 barrels per day in July. This reduction in oil production, along with high global demand, could lead to higher oil prices and at least stabilize the upward trend in the world. This is good news for the sale of Iranian oil.
*** Step by step reduction of oil production by OPEC Plus members
As mentioned, the reduction of crude oil production by OPEC member countries in May will be reduced to 6.550 million barrels per day in June, to 6.200 million barrels per day and in July to 7.750 million barrels per day. This gradual decline indicates that this year is likely to be full of prosperous days for the world energy exchange. If Iran sells its oil to China at a high discount, this price increase could practically create an opportunity for greater profitability for Iranian oil.
*** End of Saudi Arabia’s voluntary cessation of production
Saudi Arabia will also gradually end its voluntary cessation of production of 1 million barrels per day from May, and this issue will end temporarily in July. Therefore, the country will increase its oil supply to the oil market in May by 250,000 barrels per day, in June by 350,000 per day in June and in July by 400,000 barrels per day. In practice, the influx of Saudi oil may upset the market balance in the coming months. International to be done cross-sectionally and piecemeal.
*** Continuation of exemption for reducing oil production in Iran and Libya
Of course, the OPEC has agreed that countries that have fallen behind in average production will continue to have the opportunity to produce oil and will be subject to oil production and sales allowances. According to the agreement, those members who could not follow the reduction in oil production are allowed to fully compensate for their overproduction until September 30, 2021. Iran, Venezuela and Libya are still exempt from any production cuts.
*** Crude oil production record of OPEC members
In addition, the next meetings of the Joint Committee of Ministers (JMMC) and OPEC and non-OPEC ministers are scheduled for April 28. OPEC and its allied producers recorded a record 9.7 million barrels per day from May to July 2020 as global lock-in measures reduced fuel demand. Then, the group reduced the reduction from 7.7 million barrels per day since August and 7.2 million barrels per day since January, 2021.
*** The peak of the decline in oil production in March
During a meeting in January, OPEC Plus agreed to reduce crude oil production by 7 million barrels per day for February, to 7.05 million barrels per day in March and April and 6.9 million barrels per day, respectively. The reason for this decrease was the market turmoil for more production. That is why OPEC crude oil production increased last month as equipment re-supplies from Iran and Libya complicated the group’s efforts to balance global markets.
*** Bloomberg assessment of Iran’s oil production growth
According to a Bloomberg poll, the Organization of the Petroleum Exporting Countries increased production by 300,000 barrels per day, averaging 25.33 million barrels per day in March. Iran and Libya have the largest increase. In this regard, OPEC Plus agreed to gradually increase oil production in the coming months.
The group cautiously bet on the return of summer economic growth as the world improved the coronavirus epidemic. The group ignored market expectations for the second time in less than a month. The group agreed to add more than 2 million barrels per day to global oil resources from May to July. This growth in production has been due to the incredible demand for oil in China, Asia and Europe.
*** Stormy start of crude oil production in the new year
Crude oil production has grown significantly in the new year. That’s about a quarter of the amount of crude oil produced after a sharp drop in response to the Corona epidemic a year ago. Iran and Libya have so far been exempted from the union agreement to reduce facilities due to economic problems in those countries, but the two have recently recovered.
*** Bloomberg pays attention to the growth of Iranian oil production and sales
According to the survey, Tehran has increased 140,000 barrels per day to one million per day, which is the highest level since May 2019. While Iran remains under US sanctions, buyers in China have shown more enthusiasm during President Joe Biden’s new administration, which seeks better relations with Tehran than its predecessor.
*** Heavy line of Iranian oil tankers in Jane
Shipping to Asian countries has increased significantly, with vessels carrying Iranian crude lined up in Chinese ports Sara Vakhshouri, president of SVB International Energy LLC, said the country’s exports this month exceeded 1 million barrels per day. He also announced that this amount will exceed these numbers. The issue of the Iran-China trade agreement has had a huge impact, at least psychologically, on oil and energy exchanges.
*** Libya’s achievements in the growth of crude oil production
Libya has also made significant gains as the continuation of the ceasefire in the civil conflict allows the North African nation to resume its exports. The study showed that production of 100,000 barrels per day reached 1.25 million barrels per day. It should be noted that these numbers are based on the tracking of cargo ships using maritime traffic control tools and can be cited.
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