Representatives of the thirteen members of the Organization of the Petroleum Exporting Countries (OPEC) and their ten allies (OPEC+) agreed on an increase in production of 648,000 barrels per day in August, as in July, compared to 432,000 barrels per day. previously set, the alliance said in a statement after a meeting by videoconference.
The cartel therefore remains on the same line after the turning point taken last month.
Until then, and since the spring of 2021, it had limited itself to modest increases in its quotas with the aim of gradually returning to pre-Covid volume.
OPEC+ is aiming for the end of August to achieve this, says Quilter Cheviot analyst Jamie Maddock: on paper, then the 9.7 million barrels per day taken off the market during the pandemic to meet the collapse in demand will be restored. .
In reality, the actual production is below the posted quotas.
– “Political theater” –
The decision is purely “symbolic”, comments for AFP Tamas Varga, at PVM Energy, “given the little capacity available”.
OPEC+ is in fact unable to compensate for the lack of oil linked to the establishment by the United States and the European Union (EU) of an embargo on Russian deliveries.
Since the start of the war in Ukraine, Brent from the North Sea, the benchmark for crude oil in Europe, has climbed by more than 15%, and its American counterpart, WTI, by more than 13%.
They were moving around $114.27 and $105.20 a barrel respectively on Thursday, after reaching levels in March not seen since the 2008 financial crisis.
Faced with this skyrocketing, France had again urged producing countries on Monday to increase their volume “exceptionally”.
With the energy crisis in full swing, calls from the West to pump more “will surely get louder and louder,” Maddock said.
The subject will be on the menu of US President Joe Biden’s visit to Saudi Arabia in mid-July.
Edward Moya of Oanda, however, has few illusions: “It’s political theater, this trip will not lead to a significant increase beyond what has already been decided”, he says, recalling that many members “are subject to international sanctions or suffer from production problems”.
– Members on the sidelines –
As a result, the quotas set are rarely reached. According to Moya, the alliance will only deliver half of the promised additional 648,000 barrels per day.
A target of the United States and the EU since the invasion of Ukraine, Russia has joined the ranks of undesirable countries placed under sanctions, alongside Iran and Venezuela.
As for Libya, another member of the alliance, it is in the grip of a long and serious politico-institutional crisis, pitting two rival governments against each other.
Oil production, the main source of income, is hostage to these divisions with many sites forcibly closed.
Other nations such as Nigeria, Congo or Equatorial Guinea are bad students, the lack of investment in oil infrastructure at the height of the pandemic preventing them from achieving their objectives.
Even the frontrunners – the United Arab Emirates and Saudi Arabia – would struggle to boost their volume, according to remarks reported this week by French President Emmanuel Macron.
“Supply issues will therefore remain the main topic for oil, and prices are expected to rise further,” warned Ipek Ozkardeskaya, analyst at Swissquote Bank.
Capping the price of Russian oil, as envisaged by Western countries to punish Moscow’s offensive, would cause a “deficit” which would lead to a surge for European consumers, the Russian Deputy Prime Minister warned on Thursday. in charge of Energy Alexandre Novak.
Unless fears of recession take over and cause prices to fall.