The Organization of Petroleum Exporting Countries (OPEC) and its allies are preparing to lower their current crude oil production cut level to 7.7 million barrels per day (bpd), from the existing 9.7 million bpd.
The group known as OPEC+ has been curbing their crude oil output by a total of 9.7 million bpd from May 1 through July 31 in order to mitigate the adverse impact of the novel coronavirus (COVID-19) on global oil demand.
Now, joining for the 20th meeting of Joint Ministerial Monitoring Committee (JMMC) via videoconference on Wednesday, the group believes that global oil demand has recovered moderately, and wants to ease some of the cuts in their crude oil output.
There are signs of "early recovery" in the global oil market, Russian Energy Minister Alexander Novak said in his speech during opening remarks of JMMC meeting, adding that the OPEC+ group is discussing to ease output cuts to 7.7 million bpd.
Noting that there are still risks of a second wave of COVID-19, Novak said none of the additional crude oil production from easing the output will be used for exports nor to oversupply the global oil market.
"The excess oil will be used for domestic consumption in oil producing nations," he said.
Saudi Arabia's Energy Minister Abdulaziz bin Salman also said easing of the production cuts will not be much felt by the global oil market as the excess supply will be consumed by rising domestic demand in producing countries.
Noting that COVID-19 had an unprecedented impact on economies around the world and the global oil market, bin Salman said "We are acting with unity and discipline."
OPEC+ nations' ministers later started their JMMC session behind closed doors to discuss easing the production cuts.
By Ovunc Kutlu