OPEC Plus is close to reaching an agreement on production quotas

The OPEC Plus alliance is close to reaching a settlement with oil-producing countries regarding production levels over the next year, after disagreements over its production targets forced the alliance to postpone an important meeting that was scheduled for tomorrow, Sunday.

Officials said that Angola and Nigeria – both members of the Organization of Petroleum Producing Countries (OPEC) – aim to increase their shares of oil production.

The postponement of the OPEC Plus meeting – which includes OPEC and other allies, including Russia – from November 26 to 30 led to a sharp decline in oil prices.

A source told Reuters news agency on condition of anonymity that he is “99% confident that the OPEC+ alliance may reach an agreement on November 30.”

Two other sources said that an agreement was close, and a fourth source said that discussions were continuing.

Gabriel Tanimu Aduda, Nigeria’s delegate to OPEC, told Reuters on Thursday that he was not aware of any disagreements with other members of OPEC Plus regarding his country’s production goals.

Many analysts said they expect OPEC+ to extend or increase oil supply cuts next year to support prices.

The market is also waiting to know whether Saudi Arabia will extend the additional voluntary production cut of one million barrels per day and Russia’s by 300 thousand barrels per day, which is scheduled to end at the end of next December.

It is noteworthy that Nigeria and Angola are among several other countries whose production targets were changed at the last OPEC+ meeting last June after failing over the years to achieve the previous targets.

This comes after the two countries accepted production quotas that reflect the decline in their production capabilities in light of the lack of investment and operational disturbances, amounting to 1.28 million barrels per day for Nigeria and 1.38 million for Angola.

Oil decline

At the end of trading yesterday, Friday, oil prices declined as the premium associated with geopolitical risks receded with the entry of the temporary truce between Israel and the Palestinian resistance in the Gaza Strip, which included an exchange of prisoners, but prices achieved weekly gains for the first time in more than a month.

The settlement price for Brent crude futures contracts fell by 84 cents, equivalent to 1%, to $80.58 per barrel, while US West Texas Intermediate crude fell by $1.56, or 2%, from last Wednesday’s close at $75.54.

There was no settlement for West Texas Intermediate crude the day before yesterday, Thursday, due to the Thanksgiving holiday in the United States, and both contracts achieved their first weekly gains in 5 weeks.