The OPEC+ deal and Norway's decision to cut oil production can affect Norwegian petroleum producer Equinor, but the level of impact is yet to be assessed, the company said on Thursday
MOSCOW (Pakistan Point News / Sputnik - 07th May, 2020) The OPEC+ deal and Norway's decision to cut oil production can affect Norwegian petroleum producer Equinor, but the level of impact is yet to be assessed, the company said on Thursday.
On April 12, the Organization of the Petroleum Exporting Countries (OPEC) and its allies agreed to reduce oil production by 9.7 million barrels per day in May and June, followed by 7.7 million per day for the second half of the year, and then by 5.8 million per day until April 2022.
"As a consequence of the imbalances in the oil market and the significant oil price decline in 2020, the OPEC has announced production cuts starting on 1 May 2020. Equinor has some of its oil production activities in countries affected by OPEC's announcement, which may impact the level and timing of our future production," the company said in a quarterly review.
In Norway, where Equinor has production on the continental shelf, the government has "unilaterally" announced oil production cuts, according to the company. However, the impact of "the world-wide announced oil production cut measures" on Equinor cannot yet be assessed, the petroleum producer added.
During a teleconference with investors, Lars Christian Bacher, the financial director of Equinor, confirmed that forecasts on the impact of oil production on the company were hard to make. According to Bacher, the Norwegian authorities are, at the moment, deciding on ways to reach the goal of cutting oil production by 250,000 barrels per day in June and 134,000 barrels per day in the second half of the year, as envisioned by Oslo' commitments following the OPEC+ deal.
Equinor has planned to increase its hydrocarbon production on average by 3 percent per year for the period of 2019-2026, however, the company announced on Thursday that the forecast for 2020 would be reviewed.
