Financial Energy Review
by Jenifer Dike..…………
Nigeria, Angola, Gabbon are now among countries that are under OPEC+ binocular watch over non compliance of production cut.
OPEC+ is set to keep an eye on these three African countries that have previously flouted the production cut agreement in the month of May. Also Iraq, Kazakhstan and Azabaijan are countries that OPEC+ will watch during this second phase of production cut agreement.
This is because the OPEC+ alliance over the weekend agreed to extend the cuts through July. “No room whatsoever for lack of conformity this time” Abdulaziz bin Salman, Saudi Energy Minister had said.
However, it said that Iraq, Nigeria and Kazakhstan, may find it difficult to comply because of the kind of contractual agreement they have with upstream companies. “it may prove difficult for them to match their commitments 100 percent” David Fyfe, chief economist at Argus said.
Following the coronavirus pandemic-induced plunge in oil prices, OPEC+ embarked on the largest coordinated oil production cut regime in history in May. They agreed to cut 9.7 million bpd in an effort to support the market, amounting to about 10 percent of global oil supply.
OPEC’s 13 members dropped their output to 24.32 million barrel per day for a compliance rate of 82 percent with their prescribed cuts,” S&P Global Platts found in a survey released Wednesday.
The ten non-OPEC members, which include Russia, pumped a combined 13.89 million barrels per day comprising 91 percent of their cuts, bringing OPEC+’s collective compliance to 85 percent.
