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| In early April 2023, Saudi Arabia, Russia and other OPEC+ members announced that they would voluntarily cut production to support oil prices. (Source: NBC News) |
According to sources, ahead of an important meeting scheduled to take place in Vienna (Austria) on June 4, between the Organization of the Petroleum Exporting Countries (OPEC) and its allies, also known as OPEC+, the conflict between the two countries that produce the most oil in the world is becoming more and more obvious.
At the upcoming meeting, OPEC+ is expected to finalize production plans for the second half of this year, amid growing concerns that a slowdown in the global economy could drag on energy demand.
Last week, Saudi Arabia’s energy minister issued a warning to short sellers in the oil market, sending a signal that OPEC+ was ready to cut production further, as speculators increased bets on falling oil prices and Russia failed to meet its commitment to voluntary production cuts.
Meanwhile, Russian President Vladimir Putin said oil prices were approaching “economically reasonable” levels – a sign that there may be no need to change the alliance’s current output policy anytime soon.
In early April 2023, Saudi Arabia, Russia and other OPEC+ members announced that they would voluntarily reduce production to support oil prices.
Russia said it would extend its unilateral production cut plan that it had implemented since March 2023 until the end of the year. For its part, Saudi Arabia began cutting production from May 2023.
Currently, the latest figures show that Russia is still pumping large volumes of oil onto the market - a measure that helps the country maximize revenue for its domestic economy, which is facing many difficulties due to the military campaign and sanctions.
Officials from many oil exporting countries say that Moscow's aggressive oil production has also increased the supply surplus in the global market.
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