Brazil has also indicated plans to join OPEC in 2024.

After plunging considerably in early trading and more than 2% on Thursday due to worries that the voluntary oil output cutbacks agreed upon by OPEC+ producers would be unsatisfactory, oil prices pared their losses on Friday.

By 08: 20 GMT (that is 9:20am in Nigeria), February’s Brent oil futures had increased by 6 cents, or 0.1%, to $80.92 per barrel. At $76.13, U.S. West Texas Intermediate oil futures increased by 17 cents, or 0.2%.

With over 40% of the world’s oil being produced by OPEC+, production is being curtailed as prices have dropped from over $98 in late September due to supply surplus predictions and worries about slower economic development in 2024.

OPEC+ members- Saudi Arabia, Russia, and others decided to extend the 1.3 million bpd of production cutbacks that were already in place in addition to voluntarily reducing output by 900,000 bpd. Earlier, delegates had spoken about further output limitations of up to 2 million bpd.

Calling the oil producers’ action a “temporary response,” Goldman Sachs stated that its December Brent projection was “moderately tilted” to the downside of its previously predicted range and that it would be “difficult to implement.”

In a statement on Friday, Goldman Sachs said that “The market had started to price in a large probability of extra cuts, including a potential longer-lasting and official non-voluntary cut,” but kept its 2024 price outlook due to an expected slowdown in U.S. supply growth and low OPEC supply.

Producers from Saudi Arabia, Russia, the United Arab Emirates, Iraq, Kuwait, Kazakhstan, and Algeria stated that the 2.2 million bpd of total reduction will be progressively unwound following the first quarter, if market circumstances allow.

In a related development, Brazil said on Thursday that it will become a member of OPEC+ in 2024. However, this would not obligate the biggest nation in South America to reduce its output.