Members of the OPEC group of oil producers and their allies held a meeting on February 4 wherein they expressed confidence in prospects for global economic recovery and the attendant rise in crude oil demand. During OPEC+'s monthly Joint Ministerial Monitoring Committee (JMMC), leaders of all the member nations hailed the vaccine rollout stating that it was a “positive factor” for the world adding that it would “boost the global economy and oil demand”.
"The gradual rollout of vaccines around the world is a positive factor for the rest of the year, boosting the global economy and oil demand," a statement published in the aftermath of the meeting stated adding that all participants were "optimistic" for a "year of recovery in 2021".
OPEC stands for Organization of the Petroleum Exporting Countries and includes 13 countries Saudi Arabia, Gabon, Kuwait and Iraq amongst others. While the global economy has witnessed a major setback, oil market started redeeming itself since early November with benchmark crude contracts now trading at around $60 (50 euros) per barrel, levels last seen in early 2020. Meanwhile, all the OPEC nations made their contribution by agreeing to production cuts in the wake of the coronavirus-induced plunge in demand last spring.
In addition OPEC's collective production cut, Saudi Arabia has volunteered to a cut a million extra barrels per day from its production in February and March. In the aftermath, experts have pointed out that OPEC’s strategy to regulate oil prices was now working in their favour. As per eia.gov, the oil-producing group earned $323 billion in net oil export revenues in 2020, lesser as compared to $595 billion in 2019.
Vienna-based OPEC faces conflicting pressures. Raising production would increase revenues for producing countries that have seen their budgets hard hit by lower prices, but pumping too much too soon could undermine the modest price rebound