Saudi Arabia’s energy minister urged members of a 23-member alliance of oil producers to fully comply with a historic pact to cut output.
Opec+, the alliance headed by Riyadh and Moscow, met virtually to extend cuts of 9.7 million barrels per day until July to rebalance oil markets in the wake of the coronavirus outbreak.
"All Opec+ partners must deliver on their pledges for the collective interest to be sustained. Each country has to adhere to its commitment to restrain production along the agreed guidelines,” Prince Abdulaziz bin Salman said during a virtual meeting of ministers.
"Effective compliance is vital, if we are to secure the hard-won stability in global oil markets and restore confidence in the unity and effectiveness of the Opec+ group.”
His call for greater compliance was primarily directed at Iraq and Nigeria, which have consistently cut below their quotas.
Iraq, Opec’s second largest producer, derives more than 90 per cent of government revenue from the sale of oil. The Covid-19 pandemic and the subsequent collapse in oil prices in April from their recent peaks in January have badly hurt the country’s finances. A political deadlock in the country has further complicated production cuts.
Nigeria, which also needs oil revenue to support its budgetary requirements, said ahead of the meeting that it would fully comply with the restrictions and would compensate for cutting below its quota.
Producers with low levels of compliance are being pressed to make up for their shortfall by implementing additional cuts from July until September. The alliance’s joint ministerial monitoring committee is expected to meet on July 18 and will convene on a monthly basis until December to oversee compliance.