The OPEC+ producers unwinding their oil production cuts may bring forward their meeting to Saturday instead of on Sunday, with another accelerated output hike likely to be agreed, delegates and sources from the group tell various news outlets ahead of the weekend.
The eight OPEC+ members, which have been cutting production and are now returning supply to the market in monthly increments, may bring forward the meeting to July 5 from July 6, as it was originally planned, delegates from the group told Argus Media.
The potential change in plans follows a request by the Iraqi delegation to move up the meeting to avoid clashing with an Islamic holiday, according to the delegates.
The OPEC+ 8 countries – Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Algeria, and Oman – are likely to decide to hike output by another 411,000 bpd for August, anonymous sources from the producer group told Reuters on Friday.
With this hike, the cumulative increase this year would rise to 1.78 million bpd.
However, actual production increases from OPEC+ have been much lower than the headline figure as some producers appear to have genuinely started to compensate for previous overproduction.
Such is the case of Iraq, OPEC’s second-biggest producer after Saudi Arabia.
But non-OPEC Kazakhstan has been openly defying the group’s targets as it continues to raise production from projects involving international majors such as Chevron.
Kazakhstan’s Energy Minister Yerlan Akkenzhenov confirmed in May that “the republic has no right to enforce production cuts” on foreign operators.
Despite Kazakhstan’s production growth, the OPEC+ producers are adding fewer barrels to the market than the headline figure of 411,000 bpd.
Compliance and compensation levels have been and will be key for traders and investors to guesstimate how much additional crude OPEC+ is really adding each month.
OPEC+ will make its August oil production decision on the fly during the upcoming meeting, Russia said last week, suggesting there would be no pre-negotiating behind closed doors.
By Charles Kennedy for Oilprice.com
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