Azerbaijan has agreed to extend the deadline for oil output cuts

At the 11th Ministerial Meeting of the Organization of Petroleum Exporting Countries (OPEC) and non-OPEC members which was held via videoconference, it was decided to extend the existing quota for oil output cuts by 9.7 million barrels for another month, namely to the end of July.  It was agreed that countries failed to fulfill their commitments in May-June would compensate for this with production indicators in July, August and September. It was considered necessary to hold meetings of the Joint Ministerial Monitoring Committee (JMMC) every month by December 2020.  The next meeting of the Joint Ministerial Monitoring Committee was scheduled for June 18.

Thus, in July, OPEC countries will cut daily oil output by 6.084 million barrels, and non-OPEC countries by 3.616 million barrels. Saudi Arabia, the UAE, Kuwait and Oman will reduce their daily oil output by nearly another 1.2 million barrels.

In accordance with the new “Declaration of Cooperation”, Azerbaijan must continue to fulfill commitments of 164 thousand barrels for May-June, maintaining the daily crude oil output at 554 thousand barrels. 

Speaking at the meeting, Minister of Energy Parviz Shahbazov expressed Azerbaijan`s support for the decision to extend the existing output restrictions due to the crisis in the oil market and the imbalance of supply and demand.  The minister noted that a sensitive and flexible approach to the regulation of production should continue until the economic activity and market balance, which increases the demand for oil, are restored.  Azerbaijan, which supports all initiatives to stabilize the oil market within the OPEC plus format, successfully fulfilled its commitments in May.

During the discussions, the chairman of the meeting, the Minister of Energy of Saudi Arabia Prince Abdul Aziz bin Salman highly appreciated the role of Azerbaijan in regulating the oil market.

It should be noted that the historic deal adopted at the 10th Ministerial Meeting of OPEC plus on April 12 envisaged cuts in daily crude oil output by 9.7 million barrels in May-June, 7.7 million barrels in July-December and 5.8 million barrels from 2021 to April 2022.