The OPEC+ extends cuts to support crude oil prices until the end of 2025

The OPEC+ extends production cuts to support crude oil prices until the end of 2025 The situation in the oil market continues to be a source of concern for various exporting countries, as prices remain below desired levels to balance their budgets. In this context, OPEC+ has decided to extend most of its crude oil production cuts until the year 2024, with the intention of gradually phasing them out starting in 2025. This measure aims to support the market at a time of tepid global demand growth, high interest rates, and an increase in U.S. production, factors that have impacted the price of a barrel of oil around $80. OPEC+ members have implemented significant production cuts since late 2022, reducing their production by 5.86 million barrels per day, which is approximately 5.7% of global demand. These cuts, which include voluntary reductions by several countries such as Saudi Arabia, Russia, the United Arab Emirates, among others, are intended to counter market oversupply and boost oil prices. The extension of voluntary cuts until the end of 2025, as well as the allocation of production quotas tailored to the reality of each exporting country, are part of the measures adopted by OPEC+ to maintain stability in the energy market. In this regard, the United Arab Emirates have seen their production quota increased to 3.5 million barrels per day in 2025, compared to the current 2.9 million, reflecting the group's flexibility to adapt to changing market conditions. It is important to note that concerns over slow demand growth in China, the main oil importer, have had a direct impact on the evolution of crude oil prices, along with increased reserves in developed economies. These factors, combined with global economic stagnation and prospects of a rebound in U.S. production, have created an uncertain scenario in the oil market. The decision to postpone the independent assessment of production capacities of member countries until the end of November 2025, delaying the setting of production reference levels for 2026, reflects the caution with which OPEC+ is managing the current situation. This measure aims to ensure that decisions made are supported by updated and accurate information on the productive capacity of each member country. In summary, the extension of oil production cuts by OPEC+ until 2024 and their gradual elimination from 2025 onwards are a reflection of the group's efforts to support crude oil prices in a context of economic and geopolitical challenges. Flexibility and cooperation among exporting countries are key to achieving lasting stability in the energy market and ensuring a balance between global oil supply and demand.