OPEC+ Finalizes Deal on Compensation for Iraq Cuts Cheating - Bloomberg

OPEC+ Finalizes Deal on Compensation for Iraq Cuts Cheating - Bloomberg:

OPEC’s habitual quota cheat, Iraq, said it will implement its oil-production cuts in full this month and agreed on the details of how to compensate for falling short of its target in May.

The accord, reached in principle earlier in June, was finalized at a ministerial video conference on Thursday, according to delegates. It gives added credibility to the OPEC+ supply deal and could bring even more oil off the market just as the demand recovery from the coronavirus pandemic begins to accelerate.

Last month, the Organization of Petroleum Exporting Countries and its allies fell short of their 9.7 million-barrel-a-day cuts target by 1.26 million. That volume will be compensated in full in the coming months, said a delegate, who asked not to be named because the information is private.

“OPEC+ is taking its task very seriously,” Ben Luckock, co-head of oil trading at commodities house Trafigura Group, said in an interview prior to Thursday’s meeting. “Performance is going to be better. The message at the last meeting was taken very seriously, and none would like to go to the next OPEC+ meeting and be labeled a cheater.”