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Compensation Plans for Oil Cut: OPEC+ sets Deadline for Nigeria, Others

For failure to comply fully with oil output cut, the Organisation of Petroleum Exporting Countries (OPEC+) has set June 22 as deadline for non-compliant member on the oil output cut to submit their compensation plans.

The group disclosed this in a statement issued after the 19th Joint Ministerial Monitoring Committee (JMMC), held via video conference, in Vienna, on Thursday.

Nigeria was listed among countries yet to fully comply with the first phase of agreed production output cuts.

The group said that the attainment of 100 percent conformity from all participating countries was not only fair and equitable, but vital for the ongoing and timely rebalancing efforts.Compensation Plans for Oil Cut

The objective remains to help in delivering sustainable oil market stability.

The statement reads: “The Committee would like to thank those participants, namely Iraq and Kazakhstan, which have already submitted their compensation schedules.

”It agreed to give other underperforming participants, which have not yet submitted final plans, until next Monday, June 22, to submit their schedules for compensation to the OPEC Secretariat.

“Furthermore, the Committee mandated the Secretariat to reach out to all the underperforming Participating Countries to submit their schedules for compensation by the above mentioned date.

“The Committee stated their appreciation of additional voluntary contributions totaling 1.2 million barrels per day made by Saudi Arabia, the UAE, Kuwait and Oman in the month of June.

“The Committee thanked the Joint Technical Committee (JTC) and the OPEC Secretariat for its ongoing work. The JTC and the JMMC will continue their monthly meetings, with the next ones scheduled for 14 July and 15 July, respectively.” it said.

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The statement noted that the JMMC reviewed the monthly report prepared by the JTC and recent developments in the global oil market, as well as immediate prospects for the remainder of 2020 and into 2021.

It further reiterated the critical role that the ‘Declaration of Cooperation’ (DoC) continued to play in supporting oil market stability and economic recovery, in the face of the COVID- 19 pandemic shock and the subsequent severe global economic downturn.

The Committee took note of the overall conformity of 87 per cent for the month of May 2020, while it also observed individual country conformity levels.

It reiterated the critical importance that all participating countries achieved their 100 per cent level, and make up for any monthly shortfalls in the months of July, August and September.

Earlier, in his address to the JMMC, Secretary General of OPEC, Dr. Mohammed Barkindo, disclosed that it was vital that the committee looked to lay out possible pathways for the coming months and the remainder of 2020 and into 2021.

He said that it would aid all ministers in their future decision making processes, and enable the DoC partners to remain proactive to help further rebalance fundamentals and try and reduce volatility in the oil market.

“We need to be calm, but resolute; patient, but persistent. From the perspective of the OPEC Secretariat, let me stress that we will continue our outreach to other producers beyond the DoC, as well as to consumers.

“It is vital that we have transparent and open channels for communication.

“At the recent Ministerial Meetings, we had Ecuador, Indonesia and Trinidad & Tobago as observers.

“The current crisis has seen us further evolve relations with producers such as Canada, Norway and Colombia, including recent bilateral meetings with Alberta’s energy minister, Norway’s petroleum and energy minister and Colombia’s energy minister.

“We have benefited from the relationships we have evolved with US tight oil producers over the last four years, particularly at the annual CERAWeek conference.

”We have also held recent briefings with major consumers, China, India and the European Union.”

Compensation Plans for Oil Cut: OPEC+ sets Deadline for Nigeria, Others


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