Seven Opec+ countries yet to submit compensation plans

Seven of the 13 Opec+ deal participants that went above their crude output quotas in May-August have yet to submit compensation plans, according to a document seen by Argus.

The 13 countries exceeded their production ceilings by a cumulative 2.375mn b/d in May-August and are due to compensate with additional cuts in September-December. The quota-busters were asked to submit their plans detailing a monthly breakdown of when they intend to make their compensatory cuts by 25 September. Opec members accrued 1.641mn b/d of the excess production in May-August, while non-Opec participants overproduced by 734,000 b/d.

The overproduction compensation scheme — a new fixture of the Opec+ agreement following a Saudi-led crackdown against undercompliance — had been due to be completed by the end of September, but it was extended until the end of the year following a meeting of the Opec+ group's Joint Ministerial Monitoring Committee (JMMC) on 18 September.

The group of 13 overproducers unites countries that surpassed their quotas by as little as Azerbaijan's 4,000 b/d and by as much as Iraq's 698,000 b/d. Azerbaijan, Iraq, Congo (Brazzaville), Equatorial Guinea, the UAE and Kazakhstan have all turned in their compensation plans, for a collective 1.222mn b/d. But the remaining 1.152mn b/d has yet to accounted for, as Angola, Gabon, Nigeria, Brunei, Russia, Sudan and South Sudan all missed the 25 September submission deadline.

Overproducers that have come close to 100pc compliance throughout the duration of the deal so far will not necessarily be expected to hand in compensation plans, according to an Opec+ delegate.

By Ruxandra Iordache