OPEC agrees to cut production due to falling oil prices

Inflation is cooling, but prices are still tough

London-based OPEC (CNN Business) said Monday it will cut oil production next month to prepare for a global economic slowdown that weighs on demand.
The Organization of the Petroleum Exporting Countries and related oil-producing countries, including Russia, have agreed to implement a production plan of 100,000 barrels per day by October. A month ago, OPEC+ agreed to raise production similarly (equivalent to about 0.1% of global demand) in September after the US and other big oil consumers came under strong pressure to increase demand . Vegetables and fruits. prices and inflation. OPEC+ agrees to return to production levels in August 2022... In a statement Monday at 8:45 a.m. ET, the group said it would increase output by 0.1 [million barrels per day] for September 2022 alone. But global oil prices have fallen more than 20% since the start of June (US oil fell 7% in the past week alone), making producers worry about a sharp economic downturn in China, the US and Europe . Reduce the demand for barrels. U.S. gasoline prices also underwent a major overhaul, with the national average price of a gallon of unleaded falling from $5 in mid-June to $3.79 on Monday. In its August market report, OPEC cut global oil demand from cartels by 300,000 barrels a day through 2022 and the same amount through 2023. Oil prices fell as epidemic restrictions eased and it is expected to fall to 40,000 barrels per day in the fourth quarter of this year. Millions of barrels per day were shipped to China and India, and Russian supplies were better than many expected in the face of Western sanctions. According to the IEA, Russia's oil production in July was just 310,000 barrels below pre-war levels. The impact of G7 attempts to lower the price at which Russia can sell oil is still unknown, but Moscow has announced it will stop supplying oil to its members.
It also adds to OPEC's view that Iran's new nuclear deal with the US and Europe could boost supply if export sanctions are eased.

According to statements receive wionews on opec

The Organization of the Petroleum Exporting Countries (OPEC) and its allies decided to cut production to raise prices. Low inflation made many countries fear recession, and this decision was taken as a precaution. According to an OPEC statement, oil-producing countries will cut production by 100,000 barrels per day in October, equivalent to about 0.1 percent of global demand. However, he said he is ready to adjust production at any time depending on the situation.

Energy Matthew Holland said: "OPEC+ fears long-term price volatility due to weak macro sentiment, low liquidity, resurgence in China, uncertainty over the US-Iran pact and Russia's attempt to cap prices." Reuters after the announcement. Fuel prices have been very volatile in recent months, a move OPEC believes can stabilize the situation. Saudi Arabia hinted at a possibility last month, but an official statement said all OPEC countries had agreed to the move. Another factor driving the fuel prices in the market was the return of Iran as a real supplier after some time. The return of the nuclear deal allowed Iran to join its global list of suppliers, which would add about 1 million barrels a day if sanctions are lifted.

Brief explanation about opec

The term Organization of the Petroleum Exporting Countries (OPEC) refers to the 13 largest oil exporters in the world. OPEC was established in 1960 to coordinate the oil policies of member countries and to provide technical and economic support to member countries.1 OPEC is a cartel that aims to manage oil supplies to control oil prices on global markets. Avoid deviations that could affect the economy of producing and buying countries. OPEC members are Iran, Iraq, Kuwait, Saudi Arabia, Venezuela (five founding members), Algeria, Angola, Congo, Equatorial Guinea, Gabon, Libya, Nigeria and the United Arab Emirates (UAE).