OPEC+ seen sticking to modest output rises despite oil rally -Breaking
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LONDON, (Reuters) – OPEC+ is likely to maintain modest increases in oil production when it meets Wednesday. Officials said that OPEC+ heavyweights Saudi Arabia (UAE), and United Arab Emirates (UAE), recommited to their agreement with Russia despite increasing sanctions against Moscow and high oil prices of eight years.
This week, oil prices rose to $110 per barrel as sanctions by the West against Russia over its invasion in Ukraine caused disruptions in supply and problems for exports from Kazakhstan, Russia’s second-largest oil exporter.
The Organization of the Petroleum Exporting Countries (OPEC) and allies led by Russia – a group known as OPEC+ – have been raising output by 400,000 barrels per day (bpd) each month since August as they unwind cuts made after the pandemic slashed demand.
The United States stated repeatedly that they would love to see OPEC+ grow more.
However, only a small number of countries are able to spare their capacity. This includes de facto OPEC leader Saudi Arabia as well as its Gulf neighbour UAE.
Riyadh is resisting U.S. requests to boost output faster than required by the OPEC+ agreements.
OPEC+, at its February 2nd meeting, agreed to raise output by 400,000 bpd in March. This leaves it with 2.6million bpd cuts that will be unwinded by September.
Four OPEC+ source told Reuters Tuesday that the group was likely to agree an additional 400,000 bpd for April.
The sources said Russia’s invasion of Ukraine – which it calls a “special operation” – had had no impact to date on the functioning of the supply agreement.
According to Saudi state media, Tuesday’s Cabinet of Saudi Arabia affirmed its commitment for the OPEC+ deal.
Russian President Vladimir Putin called Abu Dhabi Crown Prince Mohammed bin Zayed al-Nahyan Tuesday.
U.S. close ally in Middle East, the UAE, abstained from voting on February 25, 2005, for a UN Security Council draft resolution that condemned Moscow’s actions.
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