OPEC, allies mull extending output cuts. File

Gulf Today Report 

OPEC is set to meet on Monday and Tuesday to decide if there would be an extension on production cuts as coronavirus cases surge.  

The agenda for the meeting includes coming up with a plan to change the effects of the pandemic-hit year which made the industry cut production output. 

OPEC member states are trying to curb a repetition of the slump the industry faced in April.  It is expected that the current cut of 7.7 million barrels per day will be eased to 5.8 million as of January 2021. 

Although three different companies have come up with vaccine and the announcement has left investors hopeful for a better economy in 2021, OPEC will be focusing on supporting prices in the first half of 2021.  

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Falling US output

Another main focus is crude oil prices returning to the pre-pandemic levels of 45 and 50 dollars per barrel for US benchmark, West Texas Intermediate (WTI) and Europe’s Brent North Sea. 

Additionally, there is a keen eye on production figures outside the bloc and the storage of oil.

The US output has declined to 11 million barrel per day. Three members of OPEC has also been granted exemptions from allocated quotas- Venezuela, Iran and Libya.