Oil producers have added back all the production they cut in 2020 — at least on paper — but members have no reason to quit the group.
The meeting followed the pattern of its recent predecessors, notable only for its brevity. If you thought the ministers might take a minute to worry about a world teetering on the brink of recession, with fuel prices in many consuming countries hitting new highs, you’d be wrong.
The group’s actual production is so far removed from its target, that any notional change to that goal is wholly irrelevant. Combined output by those same 20 countries — Iran, Libya and Venezuela were granted exemptions from output cuts because of their individual circumstances — was more than 2.6 million barrels a day short of their goal in May, according to data from Opec.
But Russia isn’t the only country unable to pump as much as it’s allowed. Only two members of the OPEC+ group met or exceeded their production targets in May. Nigeria and Angola, Africa’s two biggest producers, were able to extract only three-quarters of the crude they were permitted.Don’t expect it to dissolve. For all its irrelevance to actual supplies, even the non-Opec producers, such as Russia, Kazakhstan, Mexico and Malaysia, appear to be in it for the long haul.
And with every non-Opec member pumping at capacity, output targets aren’t a constraint on production.