According to media reports, OPEC+has once again strengthened its supervision of member countries' compliance with production reduction agreements.
Two OPEC+representatives who requested anonymity told the media that given the frequent overproduction of major member countries such as Iraq and Kazakhstan, the alliance is paying more attention to whether member countries comply with their production commitments.
Currently, OPEC+obtains member country production data from seven independent secondary sources on a monthly basis to assist in calculating member compliance.
One of the sources said that Russia sometimes exceeds its policy quotas, but due to Western sanctions, most of the shipping of Russian oil can only be done through shadow fleets, resulting in low transparency.
The inability of member countries to comply with production cuts has always been a major problem for OPEC+, which affects the credibility of the alliance's production reduction policy, especially at a time when the international crude oil market is in an extremely fragile supply-demand balance.
This week, global assets as a whole rose, but crude oil price benchmarks both fell. As of press time, Brent crude oil futures have fallen by over 3.2% this week, while WTI crude oil has fallen by over 4.2%.
Brent crude oil futures main continuous price daily chart
On Thursday, it was reported that the Saudi government was preparing to abandon its unofficial crude oil price target of $100 per barrel and increase production, although this move may lead to a long-term decline in oil prices.
Analysis suggests that Saudi Arabia has reluctantly accepted the long-term decline in oil prices. But Carole Nakhle, founder and CEO of Crystol Energy, believes that Saudi Arabia is more of a warning to violators within OPEC.
Because I believe Saudi Arabia has already borne most of the burden of production cuts, "Nakhle said when talking about OPEC's possible price target strategy." They certainly hope that the higher the price, the better, but nothing is fixed
At present, Saudi Arabia needs oil revenue to support its massive spending plan. The International Monetary Fund (IMF) previously estimated that the country would need oil prices of at least $96.20 per barrel to balance the government budget for 2024.
