OPEC+ confirms that it is extending the cut of its offer until July 31

The OPEC+ alliance, responsible for nearly 60% of world oil production, agreed on Saturday to extend the cut in its supplies by a further month, until 31 July, for a total of 9.7 million barrels per day (mbd), which expires at the end of the month.

This was assured by Iranian Oil Minister Biyan Zanganeh, after a teleconference of the Organization of Petroleum Exporting Countries (OPEC), prior to the OPEC+ telematic meeting, with Russia, Mexico and other independent producers.

"It was decided that the 9.7 million limit will be extended for one more month in July," Zanganeh said in a video posted on Twitter and on the website of Shana, the official agency of the Iranian oil ministry.

He added that in addition, Iraq and other countries that have not so far fulfilled their part of the commitment to reduce their pumping by 23 percent in May and June, will compensate until September by withdrawing from the market the barrels they have been pumping above the established quota.

"The agreements had been made according to what had been said and planned before, plus there was the issue of Iraq and some other countries that had not complied well. It was left to them to reduce what they had not reduced in the coming months," the minister said.

The 9.7 mbd cut also includes the allied countries, which will have to sanction the extension of the agreement's validity in the next few hours, in a second open teleconference in a few minutes. Zanganeh assured that the decision will be approved by all 23 nations.

"The first stage of the reduction of extractions agreed for May and June 2020 will be extended for another month, until the end of July," reads the final declaration of the OPEC telematic meeting, according to the Russian agency, which agreed to the draft document.

It was also decided that the OPEC+ ministerial monitoring committee will meet once a month until the end of the year to verify the level of compliance with the agreement agreed in April.

The biggest cut in the supply of "black gold" in the history of the oil industry came into effect on May 1 under a pact to keep supplies limited for two years.

The initial plan foresaw two moderate increases: the first, of 2 mbd, was to come into effect on July 1st, as the commitment to reduce pumping was to be alleviated from 9.7 to 7.7 mbd in the second half of the year.

The second would come into force on 1 January 2021, when the cut is limited to 5.8 mbd until 30 April 2022.

With today's decision, the cut to 7.7 mbd will come into effect on August 1 and will remain in effect until the end of the year.