OPEC+ close to deal on next phase of oil cuts

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Prince Abdul Aziz bin Salman, the Saudi energy minister, held phone discussions with his counterpart in Iraq. (File/AFP)
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OPEC Secretary General Mohammad Barkindo delivers his speech during the presentation of the World Oil Outlook in Vienna, Austria November 5, 2019. (REUTERS)
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Updated 14 July 2020

OPEC+ close to deal on next phase of oil cuts

  • Saudi energy minister stresses importance of alliance members meeting production targets as experts point to markets rebalancing

DUBAI: OPEC+, the oil alliance led by Saudi Arabia and Russia, is close to a deal that will take it to the next stage of the historic agreement signed in April to limit global crude production.

Ministers from the 23 countries of the alliance will meet via webinar on Wednesday to seal the deal, but behind the scenes officials from the Organization of the Petroleum Exporting Countries (OPEC) have been in talks to finalize details of the agreement to add roughly 2 million barrels per day (bpd) of oil to current levels.

Prince Abdul Aziz bin Salman, the Saudi energy minister, held phone discussions with his counterpart in Iraq, Ihsan Ismail, where they affirmed their support for the new phase of the OPEC+ deal, which they agreed would “enhance oil market stability and help accelerate the rebalancing of global oil markets.”

In a call with Timipre Sylva, the Nigerian minister for petroleum resources, Prince Abdul Aziz emphasized the importance for all OPEC+ participants to meet production targets.

Russia has already signaled its desire to implement phase two of the OPEC+ agreement.

Experts believe that global oil markets had made big progress toward rebalancing since the mayhem of March and April, when oil prices collapsed.

Demand has increased as economies around the world come out of lockdown.

FASTFACT

Russia has already signaled its desire to implement phase two of the OPEC+ agreement.

OPEC+ efforts to reduce supply have been effective, and members have been meeting ambitious targets for compliance with the output levels.

The vast majority of producers have hit targets of 100 percent compliance. Some — including Saudi Arabia as the leading OPEC producer — have exceeded their targets.

The next OPEC+ schedule, which will start on Aug. 1, will see cuts in production tapered to 7.7 million bpd from the current level of 9.6 million bpd agreed in April.

OPEC+ policymakers have been encouraged by pledges from some of the countries that had missed earlier targets — such as Nigeria and Iraq — that they would make up those shortfalls by compensatory cuts in production in the summer months. Nigeria has promised 100 percent compliance.

Oil producers in the Middle East traditionally use more fuel oil domestically during the hot summer months, and that will be accentuated this year as people who would have travelled for vacation, stay at home because of the coronavirus disease (COVID-19) pandemic-related travel restrictions.

The OPEC+ agreement, as well as natural declines in other oil-producing countries because of falling demand and crude prices, is credited with rebalancing the global market.

OPEC Secretary-General Mohammed Barkindo said: “If we had not acted in such a decisive way, the market would have been in danger of a near-total collapse.”

Oil prices have more than doubled since the lows of April. Brent crude traded at $43.25 per barrel yesterday.


Apple to launch first online store in India next week

Updated 18 September 2020

Apple to launch first online store in India next week

  • The company at present uses third-party online and offline retailers to sell its products in the country
  • India has become a key focus of tech giants over the last few years

NEW DELHI: Apple announced Friday that it will launch its first online store in India next week, as it seeks to increase sales in one of the world’s fastest-growing smartphone markets.
The company at present uses third-party online and offline retailers to sell its products in the country.
Apple CEO Tim Cook said in a tweet that the company “can’t wait to connect with our customers and expand support in India.”
The Sept. 23 launch comes ahead of India’s major Hindu festival season beginning next month.
With a nearly 1.4 billion people, including millions of new Internet users every month, India has become a key focus of tech giants over the last few years.
In August, three contract manufacturers for Apple iPhones and South Korea’s Samsung applied for large-scale electronics manufacturing rights in India under a $6.5 billion incentive scheme announced by the government.
Apple assembles some smartphones at Foxconn and Wistron’s plants in two southern Indian states.