As negotiated with the authorities, Saudi Arabia and Russia agreed to a compromise on the oil policy between the world’s largest producers to maintain production levels until February and to delay any increases until March.
West Texas Intermediate Futures, a gauge for US crude, passed $ 50 a barrel for the first time since February last year on the agreement, slipping 4.4% on the day to $ 49.69. International benchmark Brent crude rose 3.7% to $ 52.98 a barrel.
After failing to agree an agreement on Monday, the two sides are set to complete the agreement later on Tuesday, people said, with members of the Saudi-led Petroleum Exporting Countries Organization and members of a Russian-led team In a scheduled meeting between. Large oil producer.
OPEC met on Monday with Russia’s 10-producers, a group that has been dubbed OPEC-Plus for the first time in its monthly meetings to review global oil demand and their production strategy. Last month, they agreed to increase production by 500,000 barrels a day, with their net cut since the beginning of around 7.2 million barrels a day. The group plans to restore a total of 2 million barrels a day of production in the coming months.
Following agreement from the wider group for a similar increase in January, Russia initially opposed a rollover of last month’s sanctions and pushed for an increase of 500,000 barrels per day for February. Representatives said that Moscow argued that the demand for oil would introduce vaccination programs worldwide, as a dentist would have to start in the epidemic.
But Saudi Arabia and most other manufacturers wanted to extend existing output restrictions, people familiar with their idea said, concerned about the return of lockdown and the slow rollout of vaccines. Algeria, for example, pushed them to maintain it until the end of March, he said.
A deal, while restricting supply in the short term, will continue the desire to work together in prices across the broader OPEC-Plus group. A Saudi-Russian deadlock early last year contributed to a crash in prices as if the epidemic was destroying demand. But they quickly agreed to cut global oil supplies and work together to stabilize prices.
OPEC-Plus agreed to cut production to a record 9.7 million barrels a day last year and envision bringing it back, demanding an increase of 2 million barrels per day. Over the summer, they moved to return the initial 2 million, and last month agreed to add another 500,000 barrels a day.
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