OPEC Faces Unsettled Terrain as Monitoring Meeting Looms in February

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The Organization of Petroleum Exporting Countries (OPEC) and its allies, led by Russia, are gearing up for their first Joint Ministerial Monitoring Committee (JMMC) of 2024, slated for early February, although the exact date remains unconfirmed. The impending meeting holds significant weight as OPEC nations and their allies convene every two months to scrutinize compliance with their agreed-upon production levels.

The JMMC, a key forum for leading oil-producing nations, including powerhouse players like Saudi Arabia, Russia, and the United Arab Emirates (UAE), will be evaluating the adherence to the voluntary output cuts established at OPEC’s last full ministerial meeting on November 30, 2023. During that meeting, OPEC members, spearheaded by Saudi Arabia, extended their collective voluntary cut, amounting to approximately 2.2 million barrels per day (bpd) for the current quarter.

As the February meeting approaches, it is expected to provide a comprehensive assessment of the production agreements’ implementation throughout January. This evaluation is pivotal for maintaining stability in global oil markets and adjusting strategies to align with evolving economic conditions.

The meeting follows OPEC’s recent challenges, prominently marked by the withdrawal of strategic member Angola from the organization. The move, set to take effect from January 2024, echoes similar decisions by Ecuador in 2020 and Qatar in 2019. Angola’s departure has been attributed to a perceived misalignment between OPEC’s focus on membership status and the practical interests of the group.

Sources suggest that tensions between Angola and Saudi Arabia played a significant role in this decision. Allegedly, Angola has expressed dissatisfaction with what it sees as Saudi Arabia’s failure to stay abreast of crucial corporate, financial, and political developments worldwide.

The fallout with Angola raises questions about OPEC’s internal cohesion and the challenges it faces in balancing the diverse priorities and perspectives of its member nations.

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