To ensure secure supplies of crude oil to the international markets, OPEC’s fourth-largest producer has increased its crude oil production in line with its 2.811-million-barrels-a-day quota under the OPEC+ agreement, Kuwaiti Oil Minister Dr Mohammad Al-Faris announced today.
“The increased production is consistent with announcements made by the Kuwait Petroleum Corporation that it is bringing on line investments that ensure international oil markets are adequately supplied and can meet the expected future demand,” Faris’ statement said.
The country will continue to support efforts to promote market stability through the OPEC+ alliance of 23 oil producers, which is led by Saudi Arabia and Russia, Al-Faris added.
“Since 2020, OPEC+ successfully restored and maintained oil market balance and stability by ensuring adequate supplies to markets,” he added.
‘Extraordinary volatility’ of oil markets
Al-Faris also noted how years of underinvestment has led to extremely limited worldwide spare capacity.
This situation has contributed to “extraordinary volatility in the oil markets at a time when these markets need stability like never before to allow participants to plan future production capacity increases to meet rising demand”, he said.
Reflecting similar sentiment, Saudi energy minister recently told Bloomberg that “extreme” volatility of oil and gas markets is increasingly disconnected from fundamentals, which could force the OPEC+ alliance to cut production.
He also said that OPEC+ had the means to deal with challenges including cutting production.
However, nine OPEC sources told Reuters on Tuesday OPEC+ production cuts may not be imminent and would coincide with the return of Iran to oil markets should Tehran clinch a nuclear deal with the West.