OPEC Maintains Current Oil Output Policy Till June Review Section

On Wednesday, the Organisation of Petroleum Exporting Countries (OPEC) announced that it and its allies had agreed to maintain the current oil output policy through their June meeting.

According to a statement issued by the organisation recently, OPEC revealed this during its 53rd Joint Ministerial Monitoring Committee (JMMC) meeting.

The oil cartel stated that JMMC reviewed the crude oil production data for January and February 2024 and found that OPEC and non-OPEC member countries exhibited high levels of compliance with the Declaration of Cooperation (DoC).

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OPEC also stated that the committee was pleased with the commitments made by the Republics of Kazakhstan and Iraq to attain complete compliance and make up for overproduction. The Russian Federation's announcement that starting in the second quarter of 2024, its voluntary adjustments will be based on production rather than exports was also warmly received by the committee.

OPEC stated,

"Participating countries with outstanding overproduced volumes for January, February, and March 2024 will submit their detailed compensation plans to the OPEC Secretariat by April 30, 2024.

"The Committee will continue to monitor the conformity of the production adjustments decided upon at the 35th ONOMM, held on June 4, 2023, the additional voluntary production adjustments announced by some participating OPEC and participating non-OPEC countries in April 2023, and the subsequent adjustments in November 2023 and February 2024.

"The Committee will continue to closely assess market conditions and note the willingness of the DoC countries to address market developments and their readiness to take additional measures at any time, building on the strong cohesion between OPEC and participating non-OPEC oil-producing countries."

Back Story

In October 2022, OPEC and its allies decided to reduce oil production by 2 million barrels per day in November of that year. This was revealed to be OPEC+'s deepest cut since the COVID-19 pandemic of 2020.

The United States and other supporters of the group reportedly increased their output to put pressure on the decision to be made.

Also, OPEC announced in April 2023 that it and its fellow members would begin "a voluntary reduction" of 1.66 million barrels per day in crude oil production. 

According to a Saudi Ministry of Energy official cited by the Saudi state-run news agency, SPA, the cuts were scheduled to begin in May and continue until the end of the year, a report shows.

According to SPA, the cut is in addition to the reduction announced by OPEC+ in October 2022.

Again, in June last year, OPEC said it would extend the cut until 2024.

It further stated that the decision was made given the ongoing commitment made by OPEC and non-OPEC participating countries to uphold the long-term guidance for the market and to establish and maintain a stable oil market in the Declaration of Cooperation (DoC).

The Joint Ministerial Monitoring Committee (JMMC) of OPEC+ maintained the group's output policy in October last year.

In November last year, OPEC and its allies decided to reduce monthly oil production by an extra million barrels per day, beginning in 2024.

The oil cartel announced extending further voluntary cuts of 2.2 million barrels per day for the second quarter of 2024, earlier in March.