The Organization of Petroleum Exporting Countries and allies (OPEC +) agreed not to modify their agreement announced last July, which consists of an increase in the joint production of crude oil by 400,000 barrels per day for April. The markets expected a possible change in the strategy in favor of calming the nervousness that has haunted the price of oil in recent days after the escalation in the conflict between Russia and Ukraine.
Following Wednesday’s meeting, held via videoconference, OPEC+ said in a press release that current market fundamentals and prospects “point to a well-balanced market” and has said that the global spike in prices “is not caused because of changes in the fundamentals of the market, but because of the current geopolitical evolution”.
Russia, which produces about 10% of the world’s crude oil production, is one of the countries that make up OPEC+.
An increase in the supply of oil from the organization or from Saudi Arabia could add a bit of certainty to the markets, which fear a shortage of hydrocarbons due to the conflict in Europe. But the organization has decided not to make any changes.
Member countries agreed to increase production by 400,000 barrels in April last year and endorsed their decision in July, after having agreed to cuts during the first year of the pandemic, when prices sank and hit negative values.
World crude oil prices have climbed rapidly in recent days. The recovery of the global dynamics in consumption and a slower pace in production had already boosted the price, but the conflict between Russia and Ukraine has accelerated the pace.
Yesterday, Tuesday, the United States and the member countries of the International Energy Agency (IEA, for its acronym in English) –2 million barrels a day– to calm the nervousness in the markets and achieve a drop in the price of crude oil.
But despite this, this Wednesday
Brent crude futures, one of the main references, reached a maximum of 113.94 during the day, although the price has been giving way in recent hours. The US West Texas Intermediate (WTI) oil price also hit a high of $112.51 per barrel on the day. It is estimated that the Mexican mix will also end the day with a price above 100 dollars.
