OPEC and its allies, including Russia, approved Wednesday’s cut of 2 million barrels per day in oil production is the first significant production cut since the early days of the pandemic.
The group’s gathering, known as OPEC Plus, was held in person for the first time since early 2020.The decision of oil officials to meet in Vienna signaled their intention to make a strong statement to energy markets about the group’s unity and its willingness. Analysts say there is a need to act quickly to protect prices.
Following a string of leaks and rumors about a significant rate cut, the group had little choice but to accept or risk a market-disappointing outcome.
Among those present at the meeting was Russian Deputy Prime Minister Alexander Novak, who played a key role in promoting cooperation with other major oil producers. Novak is co-chair of the OPEC Plus meeting.
Novak’s presence under US sanctions could be embarrassing for European officials whose citizens could face a harsh winter due to rising energy prices linked to Russia’s war in Ukraine. .