OPEC+ to weigh rollover or oil output cut at Sunday meeting -sources
OPEC+ is likely to keep oil output policy unchanged at a meeting on Sunday, five OPEC+ sources said, although two sources said an additional production cut was also likely to be considered to bolster prices that have slid due to fears of an economic slowdown.
The Organization of the Petroleum Exporting Countries and allies including Russia, known as OPEC+, meets as demand faces headwinds from slowing economies and Chinese COVD-19 lockdowns, while a looming European Union ban on Russian crude imports and a G7 price cap on Russian oil places a question mark over supply.
Five OPEC+ sources told Reuters that the Sunday meeting would most likely roll over existing policy. Two more sources said the group could discuss another output cut, although neither thought another cut was highly likely.
The meeting, planned as an in-person gathering, may be made a partly or fully virtual event, the sources added.
A drop in oil prices, after coming close to all-time highs of $147 a barrel in March due to the conflict in Ukraine, has prompted analysts such as Eurasia Group to suggest that OPEC+ could cut output. Brent crude was trading just above $85 on Tuesday.
In October, OPEC+ agreed to cut output by 2 million barrels per day (bpd) – equal to 2% of global supply — causing one of its biggest clashes with the West as the U.S. administration called the surprise decision shortsighted.
Top OPEC exporter Saudi Arabia on Nov. 21 said OPEC+ was sticking with output cuts and could take further measures to balance the market.
“The current cut of 2 million barrels per day by OPEC+ continues until the end of 2023 and if there is need to take further measures by reducing production to balance supply and demand we always remain ready to intervene,” Saudi Energy Minister Prince Abdulaziz bin Salman was quoted by state news agency SPA as saying on Nov. 21.
The energy ministers of Saudi Arabia and Iraq met on Thursday and stressed the importance of adhering to OPEC+ output cuts that last until the end of 2023, the Saudi energy ministry said in a statement on Friday.
Source: Reuters (Reporting by Alex Lawler, Maha El Dahan, Ahmad Ghaddar, Olesya Astakhova and Rowena Edwards; Editing by David Evans and Mark Porter)