OPEC+ could change the terms of its oil production cut deal if the members of the pact agree to do it, Saudi Energy Minister Abdulaziz bin Salman said today as quoted by Reuters.
“We did tweak and I believe with consultation with our friends, some of them are present here and some of them are not, but I know how heartily they are committed to the principle of tweaking,” bin Salman said at the ADIPEC conference.
“I would go and argue it could be a tweak even beyond what the so-called analysts are talking about,” he added.
Analysts have been arguing OPEC+ could decide to extend the current production cuts of 7.7 million bpd into next year instead of following the original terms of the April deal and relaxing these to 5.7 million bpd. There have also been reports that said Saudi Arabia, Russia, and others were considering a reversal of the cut eases in response to the latest oil price decline.
The remarks pushed oil prices higher, but it is doubtful that the jump will hold as Libya reported it had raised its oil production to above 1 million bpd. Although the National Oil Corporation said it may not be able to sustain this level of production without solid financial help from the government, the fact remains that a million additional barrels are going into a market most consider still oversupplied.
Meanwhile, Covid-19 cases continue to surge in Europe and the United States. The U.S. seven-day average last week topped 100,000 cases daily, with some hospitals getting overwhelmed by the number of people needing to be hospitalized. In Europe, restrictions are tightening further in response to the surge in cases.
In addition to the grim oil demand situation, OPEC may also have another problem: a Biden presidency. According to a Reuters report, sources from the cartel expect tensions in the future because Biden could take a different stance towards Iran, Venezuela, and Russia.