The IEA assures that OPEC's oil cut can lead the global economy into recession

MADRID, 13 Oct. (EUROPA PRESS) -

The International Energy Agency (IEA) considers that the cut in production announced by the Organization of the Petroleum Exporting Countries (OPEC) and its allies, the group known as OPEC, entails the risk of leading the global economy into a recession by higher crude oil prices.

"The OPEC bloc's plan to drastically cut oil supply to the market has derailed the growth trajectory of crude oil supply for the rest of the year and next year," the Agency warned in its monthly report, published this Thursday. This planned cut has caused a rise in oil prices in the markets and greater volatility.

"With unstoppable inflationary pressures and interest rate hikes taking their toll, higher oil prices could be the turning point for a global economy already on the brink of recession," the agency said.

Last week, OPEC decided to cut its daily production by two million barrels starting in November. In this way, the countries of the group will pump a total of 41,856 million barrels per day, compared to 43,856 million in August, including a contribution of 25,416 million by OPEC, compared to the previous 26,689 million, while the countries outside the organization will produce 16,440 million.

"OPEC's massive cut in oil supply increases energy security risks around the world. Even taking into account lower demand expectations, it will sharply reduce a needed increase in oil stocks for the rest of this year and the first half of 2023," the IEA has warned.