Russia’s First Deputy Energy Minister Aleksei Texler expects participants of the OPEC+ deal to define a new goal of the agreement at the meeting on June 23, TASS reports.
"The Vienna alliance (OPEC+) is not involved in price regulation. (Previously) there was a certain goal, which has been met recently - to bring (global oil reserves) to a five-year average. Now it is necessary to set a new goal. I am confident that this agreement will be reached on 23th. A new goal of the agreement will be defined," he said on Wednesday.
Representatives of OPEC nations will meet on June 22 in Vienna, which will be followed by a meeting of OPEC+ ministers. The main agenda of the meetings is partial withdrawal from the agreement.
According to Energy Minister Alexander Novak, Russia proposes to increase the current level of production by 1.5 mln barrels per day during the third quarter and distribute quotas among participating countries on a pro rata basis.
Being against the revision of quotas, Iran, Iraq and Venezuela have threatened to veto the decision. Iran assumes that OPEC+ peers simply want to distribute its share among them. Crude production in Venezuela is collapsing due to the country’s economic downturn as output has dropped from 2.3 mln barrels per day in early 2017 to 1.4 barrels as of now. Iraq’s free productive capacities are located in a politically unstable region.
At the end of 2016, OPEC and 11 independent oil-exporting countries, including Russia, entered into an agreement to reduce oil production. According to the agreement, during the first half of 2017, the participants had to withdraw 1.8 mln barrels per day from the oil market against the level of October 2016. Russia pledged to reduce oil production by 300,000 barrels per day. The purpose of the agreement is to reduce global oil reserves to five-year average levels.
On June 22-23, OPEC + participants will meet in Vienna to discuss options for further implementation of the transaction, including mitigation of the existing restrictions.