OPEC+ extends output cut deal, Nigeria to compensate for overproduction
The Organisation of Petroleum Exporting Countries and its allies, led by Russia, have agreed to a one-month extension of their record output cuts on Saturday and adopted more stringent methods to ensure members don’t break their production pledges.
OPEC and its allies, a group called OPEC+, decided in April to cut output by a record 9.7 million barrels per day to lift prices battered by a demand drop linked to lockdown measures aimed at stopping the spread of the coronavirus.
Nigeria, Africa’s top oil producer, has said it is ready to make additional oil output cuts from July to September to compensate for producing more than its quota in May and June, when OPEC+ implemented a massive production cut deal.
“As OPEC meets today, Nigeria reconfirms our commitment under the existing agreement,” the country’s Minister of State for Petroleum Resources, Chief Timipre Sylva, tweeted on Saturday.
Sylva said the country “subscribes to the concept of compensation by countries who are unable to attain full conformity (100 per cent) in May and June to accommodate it in July, August and September.”
The extension of the production cut deal was agreed on during the 11th OPEC and non-OPEC Ministerial Meeting held via videoconference, on Saturday under the Chairmanship of Prince Abdul Aziz Bin Salman, Saudi Arabia’s Minister of Energy, and co-Chair Alexander Novak, Minister of Energy of the Russian Federation.
OPEC, in a statement at the end of the meeting, said all participating countries reconfirmed the existing arrangements under the April agreement.
It said they subscribed to the concept of compensation by those countries that were unable to reach full conformity (100 per cent) in May and June, with a willingness to accommodate it in July, August and September, in addition to their already agreed production adjustment for such months.
They “agreed without dissent that the full and timely implementation of the agreement remains inviolable, based on the five key elements, and endorsed the ‘Statement on the Declaration of Cooperation'”
