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The required crude oil production from OPEC and its non-OPEC allies led by Russia is 39.694 million barrels per day (bpd) in November, OPEC said after the OPEC+ group decided to stick to the plan to ease the collective cuts by 400,000 bpd next month.
During a short and uneventful meeting on Monday, the ministers of the OPEC+ coalition decided to proceed with increasing the group’s overall production by 400,000 bpd—the minimum the market was expecting.
As per the decision, the ten OPEC members bound by the pact should produce no more than 24.047 million bpd in November, while the non-OPEC producers will see their collective quota at 15.647 million bpd.
The two leaders of the OPEC+ group, Saudi Arabia and Russia, will each have a ceiling of production of 9.913 million bpd. Saudi Arabia is sticking to the deal, while Russia’s case is more curious.
Official Russian data doesn’t discriminate between crude oil and condensate production, but condensates are excluded from Russia’s OPEC+ quota.
Bloomberg estimates put Russian crude and condensate production in September at 10.7 million bpd. If condensate production was around 880,000 bpd, this would put Russian crude oil output at 9.83 million bpd, which would be 130,000 bpd above quota, as per Bloomberg calculations.
Analysts say that Russia may have reached its capacity to produce oil, while several OPEC members of the pact such as Angola, and at times, Nigeria, have struggled to pump to quotas over the past few months. This is one of the key reasons for the over-100-percent compliance with the total cuts.
The OPEC+ group of producers raised their compliance with the production cuts to 116 percent in August, up from 109 percent compliance in July, sources from the alliance told Reuters in September. Despite the higher production, OPEC was actually pumping at some 10 percent below its overall quota for the 10 members bound by the OPEC+ pact in August, due to outages and technical difficulties in countries such as Nigeria and Angola, Bloomberg noted last month.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.