Brazil to join OPEC+ cooperation charter without committing to oil production cuts

(Bloomberg) – Brazil will join the cooperation charter of the OPEC+ oil alliance, a move that won’t bind it to making production cuts.

Brazilian Energy Minister Alexandre Silveira told a meeting of the group on Thursday that the country would join its charter from next year. The charter, open to all oil producing countries, doesn’t bind signatories and provides a platform for dialog and exchange of views.

“President Lula confirmed our entry into the OPEC+ cooperation charter from January 2024,” the minister told the group, according to a video circulated by delegates. He was met with a round of applause.

A Brazilian official had said earlier that the country was still considering the invitation. It’s not clear joining the cartel’s output policy would be in Brazil’s interests: it is one of the world’s most significant sources of new supply growth and the cartel is currently squeezing production.

The Latin American giant exported an averaged of 1.8 MMboed in the third quarter, an increase of 40% from a year earlier, according to official data. Better-than-expected production growth from Brazil, along with the U.S., is helping to lift up global supply by 1.7 MMbpd this year to a record level, according to the International Energy Agency.