Increase in the quota system

CESCE, Country Risk

The United Arab Emirates (UAE) was by far the most favored participant in the latest meeting organized by the Organization of the Petroleum Exporting Countries (OPEC) in early June.

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The country achieved the support of the rest of the cartel members to increase production by 200.000 barrels per day (b/d) starting next year, up to 3,4 million b/d. This agreement puts an end to one of the tensions that had divided the organization in recent years.

You should remember that the delegates of WATER They had even threatened to leave the organization if their demands were not respected. This increase has been offset by a cut in the quota system allocated to several African economies, mainly Angola and Nigeria.

Unlike other oil countries, WATER does not suffer from a reservation problem. On the contrary. It is estimated that it could maintain the current production rate for more than 90 years. Added to this are the reduced extraction costs, lower than the projects off shore and the industry fracking U.S.

In this context, the country's main challenge is to be able to maximally monetize its abundant crude oil reserves, taking into account the expected drop in demand for hydrocarbons over the coming decades, as a consequence of the decarbonization of the world economy.

Source: CESCE