OPEC Keeps Current Output Cuts Till December, Underscores Need For Continued Commitment To DoC

OPEC and its allies agreed Thursday to keep current production cuts until further review in December, with the Kingdom of Saudi Arabia pledging to further strengthen its voluntary production adjustment to 9.890 million bpd in October. Iraq and Nigeria have pledged further cuts.

This came during OPEC’s 16th Joint Ministerial Monitoring Committee, JMMC, meeting held in Abu Dhabi today.

Following the meeting, JMMC underscored “the critical need for continued commitment to the Declaration of Cooperation, DoC, in support of oil market stability.”

Speaking to reporters, Saudi Energy Minister Prince Abdulaziz bin Salman, who chaired the meeting along with the Russian Energy Minister Alexander Novak, said the Kingdom is going “beyond its commitment” to ensure market stability.

“Saudi Arabia will keep its voluntary output cuts until the end of the year for further review during the next JMMC meeting in December. We will continue to monitor the market and take every possible step to ensure market continues to be sustainably supplied in a stable way. Saudi Arabia is doing more than our humble commitment in terms of its voluntary contribution (to oil cut deal). And we here confirm our reduction in October will be 9.890 million bpd.”

“The key strategic objective of Saudi Arabia’s oil policy has always been promoting stability in the broader oil market. And to achieve market stability, it is imperative that we maintain a high degree of cohesiveness within OPEC and in our relationship with our non-OPEC partners led by Russia. Acting in unity sends stronger messages to the market and gives it greater comfort. I want to stress that this important pillar of our policy will remain unchanged.”

For his part, Suhail bin Mohammed Faraj Faris Al Mazrouei, Minister of Energy and Industry, affirmed the UAE’s steadfast commitment to the Declaration of Cooperation.

“We will maintain production levels that achieve market balance and we reiterate our full commitment to support all measures that would help stabilise and balance the global oil market,” he said.

In a statement after the meeting, the JMMC said, “All participating countries present, particularly those who are yet to reach full conformity with their output adjustments, were unequivocal in providing steadfast assurance of their determination to achieve at least 100 percent conformity for the remainder of the year. Those countries which have over-conformed also reiterated their voluntary contribution. Resultantly, overall conformity will be brought to record level.

“Conformity with the voluntary production adjustments remains high, 136 percent in August. However the JMMC emphasised the core principles underpinning the DoC, namely equity, fairness and transparency.”