OPEC+ not to increase oil production in April
The OPEC+ group has decided not to increase oil production in April though the oil market faces shortages and the commodity prices have risen by over 20% since January.
Only Russia and Kazakhstan have been given green light to raise their oil production by 130,000 and 20,000 barrels per day respectively.
Analysts say that the global production will increase just slightly, by 500,000 per month, which will not impact the market situation or oil prices.
In general, the move confirms previous conservative statements by OPEC+ that the market’s recovery is still very fragile.
Saudi Arabia managed to convince other members that it was too early to boost production, and as a result, market shortages will remain at about the same level, making it possible to rapidly reduce oil inventories and keep prices at the $60-70 mark.
OPEC+ countries have taken note of the fact that oil demand will remain weak until vaccination campaigns are over, that is, until the summer at the earliest.
According to traders, the waiver for Russia and Kazakhstan indicates the flexibility that Saudi Arabia and other countries are ready to show in order to maintain the agreement.