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Saturday, 18 August 11:36 (GMT -05:00)



Stock and commodities markets

Higher OPEC+ Production Quotas Won’t Raise Oil Prices, Kudrin Says


Chairman of the Russian Accounts Chamber Alexei Kudrin assumes that the OPEC+ participants’ decision to increase the daily oil production quotas won’t affect international oil prices.
 
He thinks this is a well-thought-out decision, which will only balance the market since the production increase is likely to take place only within the scope of a balancing policy and existing pricing goals.
 
For those of you who don’t know, during the recent OPEC+ summit in Vienna that took place on June 23rd, the participants decided to raise their total production of crude oil by 1 million barrels a day in the second half of 2018.
 
In reality, they went back to the initial deal of cutting their production by 1,8 million barrels a day given the fact that the actual production was cut by 3 million barrels a day. As a result, in May, for example, the production cut plan was over-fulfilled by 50%.
 
Bloomberg called this decision Russia and Saudi Arabia’s victory since these two countries were the biggest lobbyists of this decision.
 
The market was quick to react to this decision. Brent futures went down in price by 1,5% shortly after the news.


 

 

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