Officials of member nations of the Organization of Oil producing Countries(OPEC )are scheduled to meet tomorrow, Wednesday to determine the fate of OPEC oil producers for next year, beginning from January 1, 2021.
The meeting billed to run through Wednesday, Thursday, and Friday is expected address key crucial subject matters confronting the organization and its members prior to its full meeting of November 30 and December 1, respectively.
The meeting is scheduled to determine among other things the fate of OPEC’s oil producers for 2021, according to Reuters.
The New Diplomat’s checks however reveal that the scheduled meeting which will run through Wednesday and Thursday will see OPEC’s economic commission board assemble collectively to define a way forward for OPEC in 2021 as the organization has been characterized by Covid-19 induced issues, with telling effects on oil price globally.
Further investigations show that there would be another meeting of OPEC technical team on Friday that is designed to bring together non-OPEC technical experts.
The New Diplomat’s checks reveal that the agenda of the various meetings would centre around production levels and production cuts with effect from January 1, 2021.
Presently, the current level of production cuts which OPEC and non-OPEC members had determined earlier during the ravaging effects of COVID-19 are expected to start easing off in January 1, 2021..
However, oil and gas experts posit that oil demand—which has greatly refused to recover optimally from its COVID-19 pandemic induced crash, would not compulsorily support OPEC easing its production cut template by January, 2021.
Said an insider: “The OPEC+ ministers will probably agree to extend current production for the first quarter of 2021,”
Julianne Geiger, an energy analyst with Oilprice explains: “What OPEC is hoping for is that a vaccine will boost economic activity and therefore oil demand. But precious little was said about a vaccine in their MOMR this month.
“OPEC is currently cutting 7.7 million barrels per day, with plans to decrease those cuts to just 5.7 million bpd in January.
“Even if a vaccine is approved for emergency use this month, it is unlikely to have any meaningful effect on oil demand until the second half of 2021.
“OPEC member Libya has stated that it does not intend to be part of the OPEC production cuts until such a time when its oil production has stabilized at 1.7 million bpd. It is currently producing about 1.25 million bpd. This could be a sticking point in the upcoming meetings, along with non-compliant Iraq”.