February 8, 2023

Market and Financial News

Market and Financial News Aggregator

What Exempting Russia From OPEC+ Supply Quotas May Mean for Oil

2 min read

(Bloomberg) — Exempting Russia from the OPEC+ alliance’s oil-production agreements is being discussed by some members of the Organization of Petroleum Exporting Countries, the Wall Street Journal reported.

Most Read from Bloomberg

Such a move would have major ramifications for global oil supply. Russia is one of the world’s top three crude producers — along with Saudi Arabia and the US — but it’s struggling to maintain output and exports in the face of increasing sanctions.

By removing Russia from the monthly supply quota system, it could give other OPEC+ members, particularly the Saudis and United Arab Emirates, scope to pump more to stem surging oil prices that topped $120 a barrel this week. It also comes as US President Joe Biden mulls a visit to Riyadh to try and repair frayed diplomatic relations.

Here’s what analysts had to say about the possibility of a Russian exemption and the impact on global oil markets:

SPI Asset Management

“I think there’s a good chance (for a break up), as there appears to be some friendly table-setting ahead of Biden’s visit to the Middle East,” said Stephen Innes, managing partner at SPI Asset Management. “I don’t think the Persian Gulf members could open up a more friendlier welcome card that would include bringing more barrels to market in these hyper-inflationary times. If OPEC makes up for Russia’s shortfall, then oil prices will drop further, whereas prices will continue its increase if OPEC holds onto their current production levels even without Russia.”


“There’s been too much shuttle diplomacy for this to be smoke and mirrors about a US-Saudi reset,” Helima Croft, a strategist at RBC Capital Markets LLC, said in an interview. A change to the pact would allow Saudi Arabia to bring back barrels earlier than scheduled, and the kingdom would likely attach conditions to any changes as it seeks to rehabilitate its partnership with the US, she said.

ING Groep NV

“It would make sense…

2022-06-01 01:13:47

All news and articles are copyrighted to the respective authors and/or News Broadcasters. VIXC.Com is an independent Online News Aggregator

Read more from original source here…

Leave a Reply

Copyright © All rights reserved. | Newsphere by AF themes.