After a bitter failure in early July, the Organization of Petroleum Exporting Countries (OPEC) and their allies, united under the banner of OPEC +, have reached an agreement: oil production will be significantly increased during the last five months of the year. year 2021. Good news, which comes a bit late for motorists.
Oil production up 400,000 barrels per day
In early July 2021, the OPEC + meeting was canceled amid disagreement: the United Arab Emirates (UAE) refused the baseline volume planned for the agreement. Dating from 2018, it no longer corresponded to reality after the upheavals of the market in 2020. A very specific point, therefore, which will have found a solution: the UAE’s baseline volume, as well as that of Russia, Saudi Arabia, Iraq and Kuwait, have been revised upwards. Enough to allow, Sunday, July 18, 2021, to find an agreement.
Like the first, the latter provides an increase in crude production of 400,000 barrels per day from August 2021 and at least until the end of 2021. A new meeting is already scheduled for December 2021 to take stock of the situation. Between the resumption of activity and the new threat of the Delta variant, it is difficult to predict what the real demand for crude will be.
But the production remains, despite everything, 5.8 million barrels per day lower than in 2019, difference reduced, therefore, to 5.4 million barrels per day less.
The oil is going down, but at the pump it won’t be felt right away
Direct and expected result of the OPEC + agreement: the price of a barrel of crude falls on the stock market. 72.75 dollars for Brent Monday, July 19, 2021 in the morning, 70.75 dollars for WTI. Almost $ 5 less than the peak of July 5, 2021, but still at levels not seen since October 2018.
The fall in the price of crude should also lighten the bill for motorists a little, but not during their holidays. It takes a few weeks before changes in oil prices on the stock market are reflected in prices at the pump.