Business & Economy

Finally, Saudi Arabia fulfills the desire of the Emirates

And 23 oil-producing countries, including 13 members of OPEC and 10 countries outside the cartel, led by Russia, agreed to increase oil production: from August 1 to the end of the year, 400,000 barrels per day will be added to production.
As a result of the extension of the agreement, oil prices fell sharply, after they rose after the UAE refused to sign the document two weeks ago, on the grounds that its basic production level, on which all other accounts depend, is very low. At the end of last week, pending a compromise between Riyadh and Abu Dhabi, record prices, which had reached three-year highs in the previous days, fell by about 5%: Brent fell to $73 a barrel and West Texas Intermediate to $71 .
Experts are waiting for the agreement, though belated, to restore confidence in OPEC, which has been shaken by recent disagreements between the two main members of the oil cartel: Saudi Arabia and the United Arab Emirates. The latter’s participation in the agreement is particularly important as it is one of the very few oil-producing countries that can rapidly increase and decrease production.
Thus, Saudi Arabia, the de facto leader of OPEC, eventually agreed to the position of its close ally, the United Arab Emirates, to increase its primary production by 650,000 barrels per day, as it has invested heavily in developing oil fields.
Noting that this necessitated raising the basic production levels of the other participants in the OPEC + agreement. These changes will take effect on May 1, 2022.
According to Russian Deputy Prime Minister Alexander Novak, who oversees the energy sector in the Russian government, Russia will return to pre-pandemic production levels in May. He also said that the new agreements of the “OPEC +” participants will provide the Russian budget with more than an additional 400 billion rubles.

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