OPEC+ meeting will meet on extending production cuts of crude oil and push the slow starter country such as Nigeria and Iraq to comply with the cuts. The organization of oil producers countries and allies, known as OPEC+, previously in April agreed to cut 9.7 million barrel/day during May and June production to support the sinking crude oil prices and 7.7 million barrel/day in July to December, but since the prices are still low until June, some of the oil producer countries are proposing the extended cuts. Russia and Saudi Arabia had agreed on extending the cuts of 9.7million barrel/day until the end of July, but Saudi is also seen pushing the extension until the end of August.
Brent Crude Oil benchmark was dived below $20/barrel in April, and up over 5% on Friday last week (June 5) reaching above $42, a three-month high record. The prices are in limbo around last week from the uncertainty of when the exact date of OPEC+ meetings. OPEC+ is also reminding the members and allies to follow the result of the meeting with high compliance. For countries and allies who still produce above the quota in May and June must comply to compensate the overproduction in the upcoming months.
Two of the worst compliance rates during the month of May and June were Iraq and Nigeria. Iraq blamed recent government changes and on the technical reason for weak compliance since the country is not assigning the new oil minister yet, as the current finance minister is in the role of oil minister. Nigeria promised that full compliance will be adhered by the end of this month, since only 52% compliance recorded in May. Mexico, who resisted pressure on the April meeting, was agreed to cut the output of 100,000 barrel/day from 400,000 barrel/day or around 23% of their total production.
OPEC+ technical and ministerial committee meeting to recommended on policy and review the market are scheduled on June 17 and 18.
