By Alex Lawler
LONDON (Reuters) – OPEC+ oil producers are making voluntary production cuts totaling around 2.2 million barrels per day (bpd) for the first half of 2024, led by Saudi Arabia reversing an earlier voluntary cut.
These cuts from the Organization of the Petroleum Exporting Countries and allies, known as OPEC+, come on top of previous reductions announced in several steps since late 2022 and bring the total committed cuts to around 5.86 million barrels per day, equivalent to approximately 5.7% of the world’s daily population. demand, according to Reuters calculations.
OPEC+ will meet in Vienna on June 1 to decide on the next steps in production policy.
What are the latest cuts?
The latest round of voluntary cuts of 2.2 million barrels per day was announced by individual countries on November 30, 2023.
Initially in place for the first quarter of 2024, countries extended it in March until the end of June and Russia slightly adjusted how the reduction would be implemented.
Included in the 2.2 million barrels per day is an extension of existing Saudi and Russian voluntary cuts by 1.3 million barrels per day from 2023, meaning the latest element of the cut is around 900,000 barrels per day.
WHAT WERE THE PREVIOUS CUTS?
Before November 2023, OPEC+ implemented production cuts of approximately 5 million barrels per day, consisting of 1.3 million barrels per day of Saudi and Russian voluntary cuts implemented earlier in 2023, and 3.66 million barrels per day implemented in previous steps had agreed.
Of the 3.66 million barrels per day, 2 million barrels per day was agreed by OPEC+ at the end of 2022, and several members agreed to voluntary cuts of 1.66 million barrels per day in April 2023.
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When OPEC+ met in June 2023, it extended cuts of 3.66 million barrels per day until the end of 2024.
HOW DO OUTPUT SAVINGS AFFECT THE OBJECTIVES?
The following table shows OPEC+’s promised cuts and production targets for the first half of 2024 in millions of barrels per day, based on information from OPEC, individual countries and Reuters calculations.
Totals have been rounded.
Country H1 2024 Implied H1 production Actual production
voluntary target for 2024 (March 2024)*
cuts promised targets after the first half of the year
2024
Algeria 0.051 0.908 0.959 0.91
Congo** 0.000 0.277 0.277 0.26
Equatorial Guinea 0.000 0.070 0.070 0.06
Gabon 0.000 0.169 0.169 0.24
Iraq 0.220 4.009 4.22 4.26
Kuwait 0.135 2.413 2.548 2.47
Nigeria** 0.000 1.500 1.500 1.34
Saudi Arabia 1,000 8,978 9,978 9.02
UAE 0.163 2.912 3.075 3.22
Azerbaijan 0.000 0.551 0.551 0.48
Kazakhstan 0.082 1.468 1.55 1.63
Mexico 0.000 1.753 1.753 1.61
Oman 0.042 0.759 0.801 0.76
Russia*** 0.500 8.949 9.449 9.42
Bahrain**** 0 0.196 0.196 0.75
Brunei 0 0.083 0.083
Malaysia 0 0.401 0.401
South Sudan 0 0.124 0.124
Sudan 0 0.064 0.064
Total OPEC-9 1.569 21.236 22.796 21.78
Total non-OPEC 0.624 14.348 14.972 14.65
Total OPEC+ 2.2 35.60 37.80 36.43
*International Energy Agency figures exclude OPEC members Iran, Libya and Venezuela, which are exempt from cuts
** Targets for Congo and Nigeria taken from the OPEC statement, placing their feasible production at this level
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*** Russia initially promised to deepen cuts in oil and oil products exports by 500,000 barrels per day in the first quarter of 2024. In March, Russia said it would cut output and exports by 471,000 barrels per day in April-June. The table is calculated based on the original figure
**** Figure is total for Bahrain, Brunei, Malaysia, Sudan and South Sudan
