No Hasty Decisions on Output Cuts Expected by OPEC: Novak

Russian Energy Minister Alexander Novak does not expect any hasty decisions on output cuts when an OPEC+ group monitoring committee meets next week as the oil market has been stable, Reuters reported citing Russian news agencies.

The Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, have been cutting output since May by around 10% of typical global demand to tackle the fallout from the COVID-19 pandemic.

Last month, the Joint Ministerial Monitoring Committee (JMMC), a ministerial advisory panel to OPEC+, decided to ease the cuts beginning this month to around to 7.7 million barrels per day (bpd) until December from a previous reduction of 9.7 million bpd.

Novak said there have been no additional proposals to change the deal among OPEC+ producers, the reports said.

“I think no-one is putting forward any hasty moves, additional proposals,” he said. “The market is more or less stable and we are seeing gradual balancing.”

The JMMC is scheduled to convene next week against the backdrop of an oil price recovery to above $45 a barrel from a 21-year low of below $16 in April.

Novak said the meeting could be delayed to Aug. 19 from the initially planned Aug. 18.

Russia’s flagship Urals crude oil blend is under pressure as its top buyers in Europe scramble for better refining margins by replacing Urals with cheaper grades including light oils coming from the United States, Kazakhstan and even gas condensate, traders said.

Urals for loading from Baltic Sea ports is now $0.55 per barrel cheaper than Brent and down from record-high premiums seen in June.

At the same time, condensate is being offered at $5 per barrel below Brent, traders said.

Scroll to Top