Azerbaijan supports OPEC+ decision on daily oil production quotas

By Azernews

By Ayya Lmahamad

Azerbaijan has supported the OPEC+ agreement on increasing the crude oil production up to 1.1 million barrels over the next three months, reached at the 15th ministerial meeting, the Energy Ministry reported on April 2.

Under the new Declaration of Cooperation, Azerbaijan will increase its daily crude oil production by 8,000 barrels in May, 7,000 barrels in June and 10,000 barrels in July.

Thus, Azerbaijan’s new production commitments will be 115,000 barrels in May, 108,000 barrels in June and 98,000 barrels in July.

The country’s daily crude oil production will be maintained at 603,000 barrels in May, 610,000 barrels in June and 620,000 barrels in July.

Speaking at the meeting, Azerbaijan Energy Minister Parviz Shahbazov stated that in a period of instability, the confidence of the global market inadequate and flexible decisions of OPEC+ and the unity of the participants of the Declaration of Cooperation are important.

“Our main purpose is to establish a balance in the oil market that will serve the common benefits. I believe that this decision of OPEC+ will contribute to balance the market dynamics,” the minister said.

In April 2020, OPEC and non-OPEC countries entered into an agreement on the reduction of daily oil production by 9.7 million barrels in May-June and 164,000 barrels for Azerbaijan.

In the second phase of the agreement, covering the period from August 1 to December 31, the daily production of crude oil in OPEC+ countries was reduced by 7.7 million barrels, which is 18 percent less than in October 2018.

At the 12th ministerial meeting of OPEC and non-OPEC countries, it was decided to reduce the daily production of crude oil by 7.2 million barrels in January 2021 and to regulate the increase in daily production provided, that it does not exceed 0.5 million barrels, through monthly OPEC+ ministerial meetings.

Azerbaijan’s commitment, according to the new Declaration on Cooperation, was 123,000 barrels in January 2021. Thus, in January, Azerbaijan has to increase daily oil production by 8,000 barrels and keep production at the level of 595,000 barrels.

Additionally, at the 13th ministerial meeting of the OPEC+ countries, it was decided to continue the existing quotas on daily crude oil production in February-March, and later, at the 14th ministerial meeting to continue with the existing quotas on daily crude oil production in April.