OPEC and its allies decided on Sunday stick with their current policy reduced oil production, just a few hours before new West sanctions Russia’s crude oil exports effective.
The Organization of the Petroleum Exporting Countries and other major oil producers including Russia said they would continue to limit supplies by 2 million barrels per day, a policy set in october started last month and will run until the end of 2023.
in a statementOPEC said Sunday’s meeting – held via videoconference – reaffirmed the decision made in October, adding that the group was ready to meet at any time to “resolve the market movements if necessary.”
The cuts agreed in October, the largest since the start of the pandemic, drew criticism from the United States. The Biden administration calls them “short-sighted” and says they will harm low- and middle-income countries by driving energy prices higher.
Since then, oil prices have fallen back instead, as traders focus on the ongoing coronavirus lockdowns in China and fears a global recession could take its toll. how to the need.
However, the market could be volatile in the coming days. A European ban on oil imports from Russia shipped by sea took effect on Monday, further destabilizing the energy supply outlook.
G7 countries, European Union and Australia agreed on Friday to impose a price ceiling of $60 a barrel of Russian oil shipped to other countries not subject to sanctions. The move, which also took effect on Monday, is aimed at depriving the Kremlin of revenue while avoiding a price shock by keeping Russian oil flowing into some markets.
Moscow has previously threatened to retaliate by cutting off oil supplies to price-ceiling countries.
What Ukraine is saying: Ukrainian President Volodymyr Zelensky called the decision to fix the price ceiling at $60 a “weak position”.
“The logic is clear: if the price cap for Russian oil were $60 instead of $30 like Poland and the Baltic countries talked about, then the Russian budget would get about one hundred billion dollars. every year,” Zelensky said in his nightly address on Saturday. “This money will not only go to war and not just to Russia’s continued funding of other terrorist regimes and organizations.”
