OPEC +, a group of major oil producers led by Saudi Arabia and Russia, is thinking about delay the planned production boost, thus compensating for the slowdown in economic activity due to the second wave of coronavirus and increased Libyan oil production, sources have told Reuters.
The producers were due to increase production by 2 million barrels per day (bpd) in Januaryas the world economy showed signs of life at the end of the third quarter with a relaxation of the coronavirus lockdown restrictions.
However, the number of new cases has risen around the world in recent weeks, reviving fears of a double dip recession.. As such, OPEC + is now considering delaying the planned increase.
“It seems that the extension of the cuts is necessary“a source has told Reuters, citing” possible price declines and uncertainties in demand “amid the second wave of the virus.
OPEC + implemented record production cuts of 9.7 million bpd since May 1 to rebalance the market. The deal was revised to 7.7 million bpd in the third quarter.
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