OPEC+ Set to Agree on Modest Increase in Oil Output Targets
By Olesya Astakhova, Ahmad Ghaddar and Alex Lawler
LONDON/MOSCOW (Reuters) – OPEC+ is poised to reach an agreement on Sunday for a slight increase in oil output targets, according to three sources familiar with the negotiations. The producers’ group is adjusting its plans to regain market share amidst concerns of a growing supply glut.
OPEC+ has already raised output targets by more than 2.7 million barrels per day since April, representing about 2.5% of global supply. However, the pace of increases slowed in October and November due to fears of an impending oversupply.
Challenges in the discussions have been exacerbated by new Western sanctions on OPEC+ member Russia. Moscow may face difficulties in further boosting output following sanctions imposed by the United States and Great Britain on key producers Rosneft and Lukoil.
Eight OPEC+ members, including Saudi Arabia, Russia, the United Arab Emirates, and Iraq, are expected to agree on raising December output targets by 137,000 barrels per day, as per the sources. They requested anonymity as they are not authorized to speak to the media. Another source mentioned that a pause in output hikes could also be considered.
Oil prices dropped to a five-month low of around $60 a barrel on October 20 amid concerns of a supply glut. However, prices have since rebounded to approximately $65 a barrel due to Russian sanctions and positive developments in U.S. trade discussions.
Various analysts, including RBC, Rystad, Commerzbank, and SEB, predict that OPEC+ will agree to raise targets by 137,000 bpd for December.
The Sunday meeting is scheduled for 1600 GMT, according to the sources.
OPEC+ had been reducing output for several years until April, with cuts peaking in March at a total of 5.85 million bpd. These cuts comprised voluntary cuts of 2.2 million bpd, 1.65 million bpd by eight members, and an additional 2 million bpd by the entire group.
While the group has been unwinding voluntary cuts, the final element of cuts for the entire group is intended to remain in place until the end of 2026.
(Additional reporting by Maha El Dahan; Writing by Dmitry Zhdannikov; Editing by Hugh Lawson)
