Opec+ will likely agree another small hike in oil output targets for December tomorrow, three sources familiar with the talks said, as the group moderates its drive to regain market share amid predictions of a supply glut next year.
Opec+ has raised output targets by more than 2.7 million barrels per day – about 2.5 per cent of global supply – since April but slowed the pace in October and November to 137,000 bpd from larger increases amid predictions of a looming oversupply.
New Western sanctions on Opec+ member Russia are adding to challenges in the discussions as Moscow may struggle to further raise output.
Eight Opec+ members – Saudi Arabia, Russia, the UAE, Iraq, Kuwait, Oman, Kazakhstan and Algeria – are set to agree tomorrow to increase December output targets by another 137,000 bpd, the three sources said.
A fourth source said a pause in output hikes was also possible.
Oil prices fell to a five-month low of about $60 a barrel on October 20 on concerns that a glut was building, but have since recovered to about $65 on the sanctions on Russia and optimism over trade talks.
Saudi Arabia and its Opec partners will not raise production significantly unless there is clear evidence of a supply disruption, RBC analyst Helima Croft said in a note this week.
Croft expects the group to raise targets by 137,000 bpd.
Rystad, Commerzbank and SEB also expect a 137,000 bpd increase.
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