Opec+ has once again put together a more comprehensive agreement than was widely expected during its ministerial meeting this week. Heading into the 5 December virtual meeting, expectations were of a rollover of 2.2mn b/d voluntary cuts through Q1, but there was also a sense that as with previous recent meetings, a ‘surprise’ could emerge from the talks.
And so it proved. Not just did the Opec+ ‘Group of Eight’ agree to extend the 2.2mn b/d in full until the end of March 2025, but the wider Opec+ group extended another 3.65mn b/d of cuts (2mn b/d formal, 1.65mn b/d voluntary) out to end-2026. Equally as important as the decision to defer the unwinding of the 2.2mn b/d, is that the Group of Eight also decided to slow down the pace of the tapering. From an initially planned 12-month taper, the latest roadmap is for the 2.2mn b/d to be gradually brought back into the market over an 18-month period from April 2025 to September 2026 (see table 1). (CONTINUED - 1476 WORDS)
