OPEC+ agrees to extend oil output cuts by one month, until end-July

According to the OPEC delegates, the OPEC and its allies (OPEC+) agreed to extend the oil output cuts of the current 9.7 million barrels per day (bpd) by one more month, that is, till the end of July.

The next OPEC meeting will be on November 30 and the OPEC+ meeting will be held on December 1 2020, the delegated noted.

Ahead of the meeting, the OPEC Secretariat said in a press release that “Iraq has renewed its full commitment to the oil production adjustments decisions reached in April 2020 by OPEC Members Countries and non-OPEC oil-producing countries participating in the Declaration of Cooperation.”

Meanwhile, the Ministry of Petroleum Resources, Nigeria, reported: “Nigeria reconfirms our commitment under the existing agreement; Subscribes to the concept of compensation by countries who are unable to attain full conformity (100%) in May and June to accommodate it in July, August and September.”

Market implications

The decision was highly anticipated and hence the move in oil prices already seems to be priced-in, both crude benchmarks rallies nearly 5% on Friday.

WTI refreshed three-month highs at $39.68 before settling the week at $38.95 while Brent finished just shy of the 42 barrier.