OPEC Confirms Minor Production Boost

Wednesday, January 5, 2022

At the 24^th OPEC and non-OPEC Ministerial Meeting the group announced it will raise production by 400,000 barrels per day in February in view of current oil market fundamentals and the consensus on its outlook.

Russian Deputy Prime Minister Alexander Novak co-chaired the Meeting. A statement put out by the Russian government, read “All the countries agreed to reconfirm the oil production adjustment for February 2022 by increasing daily oil output by 400,000 barrels. Amid the ongoing recovery in global oil consumption, OPEC+ countries have been complying with their voluntary commitments to increase production, with the overall conformity reaching 117 percent in November 2021. At the same time, they emphasized the need for all the participating countries to comply with the agreements and deliver on the commitments they have assumed.”

“We reaffirmed our commitment to the OPEC+ deal and have regularly made statements to this effect. Of course, every country must conform to the agreed production levels. It goes without saying that, if need be, we can adjust compensation plans, among other things, for those who have not been able to meet their commitments in full,” Deputy Prime Minister Alexander Novak said during the meeting.

In an OPEC release, OPEC and participating non-OPEC oil-producing countries stated the following outcomes of the meeting:

• Reaffirm the decision of the 10th OPEC and non-OPEC Ministerial meeting on April 12, 2020 and further endorsed in subsequent meetings including the 19th OPEC and non-OPEC ministerial meeting on the July 18, 2021.
• Reconfirm the production adjustment plan and the monthly production adjustment mechanism approved at the 19th OPEC and non-OPEC Ministerial Meeting and the decision to adjust upward the monthly overall production by 0.4 mb/d for the month of February 2022, as per the attached schedule.
• Reiterate the critical importance of adhering to full conformity and to the compensation mechanism taking advantage of the extension of the compensation period until the end of June 2022. Compensation plans should be submitted in accordance with the statement of the 15th OPEC and non-OPEC Ministerial Meeting.

The decision was also taken to hold the 25th OPEC and non-OPEC Ministerial Meeting on February 2, 2022.

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