Russian Deputy Premier affirms confidence in OPEC+ efforts to balance global oil market

(MENAFN) Alexander Novak, Russian Deputy Prime Minister, expressed confidence on Monday that the global oil market will achieve balance in the second half of the year and beyond, largely attributable to the concerted efforts of the OPEC+ alliance. This alliance, comprising the Organization of the petroleum Exporting Countries (OPEC) and allied nations such as Russia, has been actively implementing production cuts since late 2022 aimed at stabilizing and supporting oil prices.

The latest agreement within the OPEC+ framework, reached on June 2, extends previous production cuts of 2.2 million barrels per day until the end of September, with plans to gradually phase them out starting October. These measures have been instrumental in managing global oil supply levels amid fluctuating market conditions and varying demand dynamics.

According to recent assessments by the US Energy Information Administration (EIA), global oil demand is projected to outpace production by approximately 750,000 barrels per day in the latter half of 2024, primarily due to reduced output from OPEC+ countries. Similarly, OPEC's own report released last week also forecasts a supply deficit in the upcoming months extending into 2025, indicating a tightening of global oil markets.

Addressing concerns about the oil market's trajectory as production cuts are slated to ease starting in the fall, Novak affirmed his belief in the effectiveness of OPEC+ actions. He asserted that the market will continue to achieve equilibrium due to the proactive measures undertaken by the alliance. Novak's remarks underscore the strategic importance of ongoing cooperation among oil-producing nations in stabilizing prices and ensuring market stability amid evolving economic and geopolitical factors impacting the energy sector globally. 

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