Azerbaijan backs a proposal to extend term of oil production cuts


July 1, Fineko/abc.az. Today, at the 15th meeting of the OPEC+ Joint Ministerial Monitoring Committee in Vienna it was proposed to extend the deadline for the implementation of the Declaration on Cooperation on oil production cuts without changing the existing quotas for another 9 months.

Speaking at the event, Energy Minister Parviz Shahbazov stressed that as a result of over-fulfillment of obligations within the Declaration on Cooperation, adopted last December, a sharp drop in oil prices was prevented and a price margin was formed, which meets the interests of both producers and consumers.

"However, since the end of May we again see a trend towards lower oil prices. Despite forecasts for an increase in global oil demand of 1,140,000 barrels this year against last year, there is a large volume of oil supply on the market. Oil reserves in the countries of the Organization for Economic Cooperation & Development (OECD) continue to grow. Global oil supply is also expected to exceed demand in the coming years. Therefore, continuing the regulatory measures, it is necessary to extend the term of the agreement on limiting oil production," the minister added.

In his speech, the minister also pointed out that Azerbaijan fulfilled fully its obligations in May and June on daily oil production cuts by 20,000 barrels and that for 6 months of the agreement the average daily oil production was fulfilled by 125%.

The proposal on extension of the term of oil production cuts for another 9 months will be discussed today at the 176th meeting of the OPEC Council of Ministers. Tomorrow, adoption of a decision is expected at the 6th meeting of ministers of the member states and non-OPEC members.