OPEC+ countries are discussing changes to the entire package of the global agreement

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MOSCOW, June 4 (Reuters) – The OPEC+ alliance is discussing changes to the global deal’s overall package, which could include new production cuts and adjustments to countries’ production baselines by the end of 2024, OPEC+ sources told Reuters on Sunday.

The OPEC oil exporting cartel and non-OPEC nations meet on Sunday to discuss changes to the deal amid falling oil prices and looming oversupply.

The OPEC+ alliance, which includes an organization of oil exporting countries and allies led by Russia, produces about 40% of the world’s oil production, which means that its decisions can have a serious impact on oil prices.

“We are discussing a full package[zmian w umowie]one source said on Sunday.

The sources added that the UAE will receive a new, higher level of production if an agreement is reached.

The baselines are the oil production levels from which the reduction is calculated.

The UAE is pushing to increase quotas in line with increasing production capacity, but this would mean that its share of the total reduction could decrease.

Three OPEC+ sources also said the group would look at baseline production levels for countries for 2023 and 2024.

Such discussions have been contentious in the past: West African countries such as Nigeria and Angola have long been unable to produce according to their quotas, but they oppose lower baselines as the new quotas may force them to cut production in real terms.

Four sources familiar with details of the OPEC+ talks told Reuters that further production cuts are being considered.

Previously

Reuters sources said the cuts could be as high as 1 million barrels a day, in addition to existing cuts of 2 million barrels a day and voluntary cuts of 1.6 million barrels a day, which were unexpectedly announced in April and took effect in May.

If the new cut is approved, the cumulative decline in production will amount to 4.66 million barrels per day, or about 4.5% of global demand.

As a rule, production cuts take effect one month after they are agreed, but ministers can also agree on a later implementation. They can also decide to keep the production volume unchanged.

The April deal helped boost oil prices by about $9 a barrel to $87 a barrel, but they fell quickly under pressure from global growth and demand concerns. On Friday, Brent’s reference price was $76.

Western countries accuse OPEC of manipulating oil prices and undermining the world economy due to high energy prices. The West has also accused OPEC of supporting Russia too much despite Western sanctions.

Asian countries such as China and India receive the lion’s share of Russia’s oil exports and have refused to join Western sanctions against Russia.

Cartel insiders and observers say that money printing in the West over the past decade fueled inflation and forced oil-producing countries to increase the value of their exports.

The OPEC cartel denied Reuters and other media representatives entry to its headquarters in Vienna this Sunday. (Reuters Team at OPEC)