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OPEC leaders convene in Vienna in 2-day in-person meeting

Responsible for 40% of oil output, OPEC+ Ministers convene in Vienna in person for the first time since before the Covid-19 pandemic this weekend to decide upon production levels. Ministers of energy of the alliance of 23 oil producing countries meet amid speculation that there could be more supply cuts to their current production of 1.5 million barrels a day.

Ministers are confronted with a turbulent oil market characterized by unstable supply, uncertain demand, and the looming possibility of a recession that could significantly impact transportation fuel consumption.

Investors are keen to confirm whether speculated supply cuts will be decided upon. OPEC+ have lowered supply by 2 million barrels a day since October last year. In remarks that some interpreted as suggesting the possibility of additional supply cuts, Saudi energy minister Prince Abdulaziz bin Salman cautioned oil market speculators on May 23, indicating that they might encounter more challenges in the future.

Following the Saudi statement, Russia’s Deputy Prime Minister Alexander Novak expressed his anticipation that no further actions would be taken during the OPEC+ meeting.

Since a dispute in March 2020 resulted in a temporary dissolution of their oil partnership and sparked a price war, Russia and Saudi Arabia have presented a united front in their public stance within OPEC+. Subsequently, Moscow and Riyadh repaired their relationship by reaching a new OPEC+ agreement to address the sharp decline in demand caused by the Covid-19 pandemic.

They have since maintained a shared perspective on OPEC+ matters, dispelling any perception of a public rift. Illustrating this harmonious approach, Saudi Foreign Minister Prince Faisal bin Farhan al-Saud and his Russian counterpart Sergey Lavrov convened on Thursday during a BRICS summit in Cape Town.

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