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Kuwait and 7 OPEC+ countries extend voluntary crude oil production cuts

07-09-2024

The State of Kuwait and seven other countries of the OPEC+ alliance decided today, Thursday, to extend the voluntary reduction in their crude oil production that they announced in April and November 2023 for a period of two months until the end of next November. The Organization of the Petroleum Exporting Countries (OPEC) stated in a statement that this came after a virtual meeting held by the State of Kuwait, the Kingdom of Saudi Arabia, the United Arab Emirates, the Sultanate of Oman, Iraq, Algeria, the Russian Federation and Kazakhstan. The statement quoted the countries participating in the meeting as affirming their collective determination to fully adhere to the voluntary production adjustments. It added that the Republics of Iraq and Kazakhstan, whose production exceeded the agreed level since January 2024, also confirmed their full commitment to the agreement and to the plans to compensate for the increase in production that they submitted to the OPEC General Secretariat, as agreed upon at the 53rd meeting of the Joint Ministerial Monitoring Committee held on April 3. He pointed out that Kuwait, Saudi Arabia, Russia, the UAE, Algeria and the Sultanate of Oman had held two ministerial meetings with Iraq and Kazakhstan last August, during which the two countries were urged to achieve full compliance and compensate for the increase in production since last January. He explained that Iraq and Kazakhstan expressed their commitment in the two meetings to work with secondary sources to develop production adjustment plans to achieve full compliance and implementation of the compensation schedules they submitted to the OPEC General Secretariat on August 22. The statement confirmed that Iraq and Kazakhstan also renewed their commitment during the visits of OPEC Secretary-General Haitham Al-Ghais to them in late August, which were coordinated with the Saudi Minister of Energy, Chairman of the OPEC+ Ministerial Committee. He noted that during these visits, the OPEC General Secretariat organized workshops with secondary sources, during which both countries provided comprehensive details regarding the immediate and tangible measures being implemented to achieve full compliance with the required production levels and full implementation of the compensation plans for the months of August and September. He explained that these measures included bringing forward the dates of field maintenance plans and production reductions, in addition to delaying and canceling spot oil sales for the month of August. The two countries also committed to amending compensation plans for any increase in production in the month of August. The statement announced that in confirmation of this renewed and firm commitment by the member states, the eight countries agreed to extend the additional voluntary production cuts of 2.2 million barrels per day for two months until the end of next November, after which date the voluntary reduction quantities will be gradually restored on a monthly basis starting from the first of next December, with the possibility of stopping or reversing these adjustments as necessary. The countries whose production exceeded the agreed level also confirmed their commitment to compensate for all excess production quantities by September 2025.