OPEC+ fails to resolve production quotas

BENOÎT PELEGRINThe members of the OPEC+ alliance of oil producing countries failed to reach agreement on production quotas from August at a meeting on Friday and talks will continue this week.Friday's videoconference talks, which had themselves run over from Thursday, involved a meeting between the 13 members of OPEC proper led by Saudi Arabia, followed by a technical meeting and full discussion between the 23 members of OPEC+.The wider grouping includes Russia, the world's second-largest oil producer. Earlier on Friday a Russian government spokesman had refrained from commenting when asked if the current impasse could produce a crisis like that seen in March 2020.Back then, a falling out between Moscow and Riyadh sent US crude prices below zero for the first time in history.The hitch in Thursday's discussions came "due to the United Arab Emirates (UAE) raising a last-minute objection to the Russian-Saudi Arabia deal reached earlier in the day", according to analysts from Deutsche Bank."The UAE, which has raised its production capacity since 2018 when the individual baselines were set, insisted on having its baseline lifted by 0.6 million barrels per day (bpd) to 3.8 million bpd, thereby allowing them a unilateral production increase within the current quota framework," according to Ole Hansen from Saxobank."Negotiations will be difficult as OPEC+ knows that if the UAE is allowed to produce from a different base, other members may protest," said Louise Dickson from Rystad. - Nampa/APF

OPEC+ fails to resolve production quotas

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