OPEC has cautioned all participating countries to remain vigilant and flexible given the uncertain market conditions. However, it has acknowledged the recent improvement in the market sentiments. It noted that the rollout of vaccine programs and additional stimulus packages in key economies is driving oil market performance.

The meeting also admonished its members to remain on the course which had been voluntarily decided and yielding rewards. Per OPEC Secretariat calculations, the price of the OPEC basket of thirteen crudes stood at $62.15 a barrel on Wednesday, March 3, 2021. This is higher than $61.97 per barrel on Tuesday.

OPEC said this during the 14th Meeting of OPEC and non-OPEC Ministers on Thursday, March 4, 2021. The Meeting welcomed the appointment of HE Mohammed Al-Fares, as the new Minister of Petroleum of Kuwait. It also acknowledged the return of HE Mohamed Arkab, Energy Minister of Algeria.

Developments at the OPEC meeting

The Meeting emphasized the ongoing positive contributions of the Declaration of Cooperation (DoC) in supporting a rebalancing of the global oil market. The historic decisions taken at the 10th OPEC and non-OPEC Ministerial Meeting are in line with the ongoing developments. OPEC decided on the 10^th Meeting to adjust downwards overall crude oil production and subsequent decisions.

OPEC noted, with gratitude, the significant voluntary extra supply reduction made by Saudi Arabia. The reduction took effect on February 1, 2021, for two months, and supported the stability of the market.

The Ministers also commended Saudi Arabia for the extension of the additional voluntary adjustments of 1 mb/d for April 2021. They said this is exemplifying leadership, and demonstrated its flexible and pre-emptive approach.

The member countries approved a continuation of the production levels of March for April, except Russia and Kazakhstan. OPEC allowed the duo to increase production by 130 and 20 thousand barrels per day respectively. This is due to continued seasonal consumption patterns.

The Meeting reviewed the monthly report prepared by the Joint Technical Committee (JTC), including the crude oil production data for February.

It welcomed the positive performance of participating countries. Overall conformity with the original decision was 103 percent. This reinforced the trend of aggregate high compliance by participating countries.

The Meeting noted that between April 2020 and January 2021, OPEC and non-OPEC countries had withheld 2.3bn barrels of oil. This is accelerating the oil market rebalancing. The Meeting Extended special thanks to Nigeria for achieving full conformity in January 2021. And also compensating its entire overproduced volumes.

Matters Arising

The ministers thanked HE Timipre Sylva, Minister of State for Petroleum Resources of Nigeria, for his shuttle diplomacy as Special Envoy of the Joint Ministerial Monitoring Committee (JMMC). H.E. Timipre Sylva served as Special Envoy to Congo, Equatorial Guinea, Gabon, and South Sudan. He went there to discuss matters about conformity levels with the voluntary production adjustments. He also visited the countries to discuss the compensation of over-produced volumes.

Several countries have made requests for an extension of the compensation period until the end of July 2021. The ministers accepted the request but have not yet completed their compensation.

The meeting urged all participants to achieve full conformity and make up for previous compensation shortfalls. This, they noted, will help reach the objective of market rebalancing and avoid undue delay in the process.

The gathering observed that in December, stocks in OECD countries fell for the fifth consecutive month. The Ministers thanked the JTC and the OPEC Secretariat for their contributions to the meeting. 31^st March and 1^st April 2021 have been scheduled as the next meeting days.