How will Opec+ manage its cuts amid the ongoing negotiations between Russia and the US in Saudi Arabia?

Mr. Choeib Boutamine

February 24, 2025

Speaking to Gulf Intelligence, the CEO of Randarill, Mr. Choeib Boutamine, has said that OPEC+ is currently facing a surplus of approximately 500,000 barrels per day.

This comes while the recent Ukrainian attacks on a Russian pipeline reduced the latter’s supply by 380,000 barrels per day. 

Meanwhile, negotiations between Russia and the USA are ongoing in Saudi Arabia, focusing on the possibility of lifting sanctions on Russia while those on Iran are still tightened. 

Currently, about 90% of Iranian oil is exported to China. 

Since the beginning of the Russia-Ukraine war, Russia has been exporting oil to India and China at discounted rates, increasing China’s competitiveness with the US. 

The US seeks to maintain low oil prices; however, prices below $70 per barrel will not encourage US companies to increase drilling. 

Additionally, OPEC+ is challenged by carbon neutrality targets and the rise of EVs, especially in China, where 9.7 million EVs were produced in 2024. 

The International Energy Agency predicts that 5 million barrels of oil per day could be phased out of the market by 2030, as a result of the rising production of EVs. 

As for oil demand, it is unlikely to see an increase in April, though there may be a rise during the summer as travel increases.