For the first time since March 2020, the “OPEC Plus” alliance plans to meet in person next Wednesday to discuss lowering oil production to stem the recent slide in prices. The Organization of Petroleum Exporting Countries’ Secretariat announced that a meeting of the alliance, which consists of 23 nations and is chaired by Saudi Arabia and Russia, will take place at its headquarters in Vienna (OPEC).
OPEC+ summit
The alliance met monthly online, and the delegates were not expected to be present at a meeting until at least the end of 2022, according to the organization’s delegates, who noted that all nations might not be able to send representatives owing to a lack of time. Following the Russian invasion of Ukraine in February 2022, the price of Brent crude surged above $125 per barrel.
Since then, Brent has dropped to $85 as central banks around the world raise interest rates to combat inflation and faltering economies, diminishing the enormous windfall earnings enjoyed by the Saudis and their allies, notably JPMorgan Chase. According to Helima Croft, chief commodities analyst at RBC Capital Markets, OPEC+ may need to reduce production by at least 500,000 barrels per day to stabilise prices. However, the alliance may choose to reduce output by double that amount.
US penalties
This announcement comes a day after Alexander Novak, the Russian Deputy Prime Minister and in charge of liaising with “OPEC +,” was subjected to sanctions by the United States following Moscow’s annexation of four areas in Ukraine. Although it is from the United States, the European Union is anticipated to impose new penalties of its own on Moscow. Whether or if they will target Russian personnel is unknown.
When asked if Austria would be okay with a senior Russian official visiting Vienna, a spokeswoman for the foreign ministry responded that “the aforementioned person is not currently included under EU sanctions” and that OPEC has diplomatic status in the Austrian capital, but this will not apply since Russia is a member of the informal and broad “OPEC +” alliance.
Russian isolation under pressure
In 2016, the Organization of the Petroleum Exporting Countries (OPEC), which consists of 13 nations, collaborated with 10 other significant producers, including Russia because of its invasion of Ukraine.
During a previous meeting on September 5th, “OPEC Plus” reaffirmed its preparedness to stabilise the market with a symbolic cut.
The coalition would continue to be “proactive and active,” Saudi Arabia’s Energy Minister Prince Abdulaziz bin Salman assured, to deal with sharp price swings.
The first face-to-face meeting of the OPEC alliance since 2020
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