The person continued, “The United States has contacted OPEC representatives to reassure them that these limits will not be placed on them.”
Last week, OPEC Plus, which consists of OPEC and its allies, including Russia, declared that it would cut output by two million barrels per day in order to stabilise the markets and minimise volatility.
According to Saudi Arabia, the actual drop will probably be close to one million barrels per day because numerous OPEC countries are having trouble meeting their existing production targets.
According to the US official, the maximum price would not be applied to other producers and is specifically intended to penalise Russia’s invasion of Ukraine on December 5.
In response to the effects of OPEC policy on the oil market, he continued, asking to remain unnamed, “the new sanctions also do not signify the start of the construction of a conglomerate for buyers.
The US Treasury official believed that “the impact of the production reduction from OPEC + on prices is limited,” adding that “the onset of a recession may necessitate an increase in prices of about $30 to $40 or a ten percent reduction in production, such as the actual reduction of OPEC + production, which amounts to about 900 thousand Daily barrels.
“The Group of Seven is determined to deny Moscow income during a conflict, but it wishes to avoid a global shock in supply that may boost prices and have an impact on the residents of the group’s nations while escalating fears of a global recession.
An American official: OPEC won’t be the target of the Russian oil price ceiling.
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