Major OPEC+ countries decided to maintain oil production quotas for November during a video conference on Sunday, October 29, 2023. This decision follows the continuation of tensions in the Middle East and a significant reduction in oil supply by members of the group.
Details of OPEC+ Decisions
A subgroup consisting of seven countries led by Saudi Arabia and Russia announced that it will keep production quotas steady in November. This decision aligns with the existing production roadmap of the group and appears to be related to rising oil prices to around $100 per barrel and record diesel prices at the pumps.
Read more: OPEC+ Oil Production Plan for Next Month Remains Unchanged
Analysis of Oil Production Situation
The Organization of the Petroleum Exporting Countries (OPEC) and its allies had previously announced that there would be no increase in production quotas until the end of this year. Meanwhile, in the past six months, there have been minor increases in oil production, primarily due to the impact of the Iran war on oil production in the Gulf, which were symbolic. Thus, these increases theoretically compensate for the reductions made in 2023 and may allow Gulf Coast members to increase their production if tensions decrease.
Currently, production in key OPEC countries such as Saudi Arabia, Iraq, and Kuwait is significantly lower than pre-war production levels. Specifically, Saudi production has dropped to about 10.5 million barrels per day, which is considerably low compared to the country's full production capacity of over 12 million barrels per day.
The OPEC+ seven-country subgroup is set to hold an online meeting again on November 1, where plans for December are likely to be finalized. Future decisions of this coalition will depend on whether part of the production that was halted in 2022 will return to normal. This complex process will likely be influenced by the results of an ongoing audit of the production capacity of the group's members.
Policies for next year will also be determined in a full ministerial meeting on November 29. The Joint Ministerial Monitoring Committee (JMMC) will also hold its next meeting on the same day.
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