The OPEC + meeting, made up of the Organization of the Petroleum Exporting Countries and its allies, was a bitter failure. Scheduled for Friday, July 2, 2021 and supposed to end with an increase in production, it will ultimately have created more tensions than solutions. Canceled, it is postponed sine die : The United Arab Emirates, a main member of OPEC, rejected the proposals.
No increase in production: United Arab Emirates against the rest of OPEC +
Faced with an increase in the price of oil on the stock market which poses a risk of high inflation, especially in industrialized countries, OPEC + had plans to increase its oil production. The latter should, according to the plan presented on Friday, July 2, 2021, gradually increase by 2 million barrels of oil per day by the end of 2021, with a speed of around 400,000 barrels per day each month between August and December 2021. .
But the Emirates said “no”… because the deal was not in their favor. The latter took as reference production that of October 2018, that is to say for the United Arab Emirates a production of 3.17 million barrels per day. However, production has since increased: in April 2020, in the midst of a health crisis and before OPEC closed its taps, production had reached 3.8 million barrels per day.
Accept the agreement, therefore an increase of 2 million barrels by the end of 2021 for all OPEC + countries, would have penalized the United Arab Emirates: the increase in their production would have been lower, in reality, than the production of April 2020.
The deal jumps, the oil climbs
The planned agreement therefore failed, the OPEC meeting having been postponed for the first time from Friday, July 2, 2021 to the following Monday, then sine die, for lack of an agreement between the members of the cartel. On the stock market, the reaction was immediate: production does not increase, the tension on the market remains stable and will tend to strengthen.
Unsurprisingly, oil therefore jumped on the stock market from around $ 75.50 per barrel on Friday July 2, 2021 to nearly $ 77.50 on Tuesday July 6, 2021 for Brent before the opening of the markets. The WTI, American, climbs a little less, reaching 76.70 dollars per barrel.
Such a price of WTI oil had not been recorded since October 2014. As for Brent, a barrel over $ 75.7 had not been seen since October 2018.
Such a rise in prices on the stock market should have repercussions on prices at the pump in the weeks and months to come, that is to say in the middle of the holiday period for the French. What weighs a little on the budget, especially for vacationers who have opted for the car to go to their resorts.