(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.
The move doesn’t mean it will join in with production quotas. That distinction is key as Brazil is one of the world’s most significant sources of new supply growth and OPEC+ is currently trying to curb production. State-controlled oil company Petrobras is also stepping up investment.
Petrobras Chief Executive Officer Jean Paul Prates told Bloomberg that OPEC+ “is aware that Brazil can’t be subject to quotas as it has a publicly traded company.”
The Latin American giant exported an averaged of 1.8 million barrels of oil daily in the third quarter, an increase of 40% from a year earlier, according to official data. Better-than-expected production growth from Brazil and the US is helping to lift daily global supplies by 1.7 million barrels this year to a record, according to the International Energy Agency.
Read More: OPEC+ Agrees on Deeper Output Cuts to Avoid Renewed Surplus
Relations between Brazil and OPEC+ have strengthened under President Luiz Inacio Lula da Silva, a leftist who seeks to represent the developing world at large. Petrobras’s Prates traveled to Vienna in July to take part in the group’s seminar and in October OPEC Secretary General Haitham Al-Ghais met with Lula and other officials in Brazil.
--With assistance from Peter Millard and Ben Bartenstein.
(Updates with Petrobras comment)
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