OPEC+ agreed to extend most of its deep oil output cuts well into 2025, according to the statement of the OPEC and non-OPEC Ministerial Meeting released on Sunday.
OPEC+ members are currently cutting output by a total of 5.86 million bpd, or about 5.7% of global demand. Those include 3.66 million bpd of cuts, which were due to expire at the end of 2024, and voluntary cuts by eight members of 2.2 million bpd, expiring at the end of June 2024.
On Sunday, OPEC+ agreed to extend the cuts of 3.66 million bpd by a year until the end of 2025 and prolong the cuts of 2.2 million bpd by three months until the end of September 2024.
OPEC+ will gradually phase out the cuts of 2.2 million bpd over the course of a year from October 2024 to September 2025.
OPEC expects demand for OPEC+ crude to average 43.65 million bpd in the second half of 2024, implying a stocks drawdown of 2.63 million bpd if the group maintains output at April's rate of 41.02 million bpd.
The UAE has been pushing for a higher production quota, arguing its capacity figure had been long under-estimated. But OPEC+ postponed the discussions on capacities until November 2025 from this year.
Instead, the group agreed a new output target for the UAE which will be allowed to gradually raise production by 0.3 million bpd, up from the current level of 2.9 million.
The Russian government said that OPEC+ countries have decided to gradually resume voluntary production cuts from October 2024.
"The OPEC+ participants made a decision to extend the oil production quotas, which has been in place in 2024, throughout 2025. At the same time, it was decided to partially resume voluntary production cuts from October 2024," the statement reads.
The OPEC+ ministerial meeting was attended by Russian Deputy Prime Minister Alexander Novak.
