Brazil still has no plans to join OPEC – Energy Minister

RIO DE JANEIRO, BRAZIL – Brazil has no plans to join the Organization of Petroleum Exporting Countries (OPEC) for the time being. However, it is working with the group, Mines and Energy Minister Bento Albuquerque said Wednesday (17).

President Jair Bolsonaro said in 2019 that he wanted his country to join OPEC, a move that would likely require Brazil, the world’s seventh-largest oil producer based on 2020 figures, to limit oil production.

“At the moment, there are no plans to join OPEC. We continue to work with OPEC cooperatively,” the minister told reporters in Abu Dhabi during an energy conference, speaking through a translator.

OPEC groups the largest exporter, Saudi Arabia, and 12 other countries, including the United Arab Emirates. Since 2017, OPEC has maintained an agreement with non-member producers, except Brazil, in a grouping known as OPEC+ to limit supply and support the market.

“We continue to hold meetings with Saudi Arabia and the United Arab Emirates,” the minister said. “We understand that we have to have a good relationship with OPEC and OPEC+.”

Brazil was the world’s seventh-largest oil producer in 2020, according to data from the U.S. government’s Energy Information Administration, pumping 3.79 million barrels per day.

If it joined OPEC, it would become its third-largest producer and the most significant new member in years.

Oil prices have jumped in 2021 to a three-year high above US$86 a barrel as OPEC+ reduces the supply restrictions put in place at the height of the pandemic and global demand recovers.

Asked whether prices were too high and whether OPEC+ was to blame, the minister said that Brazil and OPEC have similar challenges and that aggregate oil prices were economic.

“We consider that oil and gas prices are high and have an impact on the Brazilian economy. We also understand that this is a consequence of the recovery of the world economy,” he said.

In January 2020, the energy minister said Brazil would begin discussions about joining OPEC later that year, but an OPEC source, speaking on condition of anonymity, said Wednesday that the issue had become “very quiet”.

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