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TEHRAN, June 22 - The OPEC oil countries agreed Friday to increase their combined production by almost 1 million barrels a day, though questions remain over some members' ability to do so amid domestic trouble and sanctions.
TEHRAN, Young Journalists Club (YJC) - After a meeting in Vienna, Emirati Energy Minister Suhail al-Mazrouei said the cartel decided to fully comply with its existing production ceiling.
Because the group had been producing below that level, that effectively means an increase in production. The minister said that amounts to "a little bit less than 1 million barrels."
How that translates into effective production increases is uncertain, as some OPEC countries cannot easily ramp up production. Venezuela's production has dropped amid domestic political instability.
The price of oil jumped after the announcement, with the international benchmark, Brent, gaining $1.61 to $74.66 a barrel.
Al-Mazrouei noted that the decision "is challenging for those countries that are struggling with keeping their level of production." However, he indicated that some countries could pick up production if others lag.
"We will deal with it collectively," he said.
Friday's decision means OPEC will observe the production level it agreed on in late 2016, when it cut output by 1.2 million barrels a day. In practice, its combined output was even less due to production problems. That has since then helped push up the price of oil by almost 50 percent.
Non-OPEC countries like Russia had agreed in 2016 to participate in OPEC's effort to raise prices, cutting 600,000 barrels a day of their own production. They will discuss with OPEC on Saturday on whether to increase their own production.
The production limits by the Organization of the Petroleum Exporting Countries and Russia since 2016 have helped increase oil prices, with the benchmark U.S. crude contract hitting its highest level in more than three years in May.
Source: AP
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