OPEC+ countries ready to extend current terms of deal?

Saudi Arabia contacted a number of OPEC+ countries on March 29, most of the alliance members express their readiness to extend the current terms of the agreement for May, while Riyadh has assured that it is ready to extend its own voluntary reductions, expressing concerns about the uncertainty of the market situation, a source in one of the delegations told RIA Novosti, Report informs.

“The contact was yesterday, Saudi Arabia, as one of the main participants in the process, was learning the opinion of the alliance members. Riyadh said that, judging by its contacts, the majority of the participants intend to extend the terms of the agreement for May,” the source said, naming the uncertain and unpredictable situation on the market as possible reasons.

“Yesterday Riyadh had big fears that nothing could be predicted in the market. Therefore, according to the Saudis, it is necessary to take a cautious approach. As for their (Saudis) voluntary restrictions, there are assurances that they are ready to extend them. In order to take any step towards easing restrictions, one must at least see the near future prospective. Unfortunately, there are no such opportunities now, in a pandemic,” the source added.

The agreement between OPEC and non-OPEC countries, including Russia, began in 2017 but was renewed in 2020. Since May, the union has cut 9.7 million barrels of oil production due to declining demand caused by the coronavirus pandemic.

Restrictions were adjusted as demand recovered, reaching 7.05 million barrels per day in March, 6.9 million barrels in April, and 8.05 and 7.9 million barrels, respectively, taking into account the voluntary reduction of Saudi Arabia.

The next conference of the OPEC + Joint Ministerial Monitoring Committee (JMMC) will take place on March 31, and the meeting of the entire OPEC + alliance is scheduled for April 1.