OPEC+ suspends increases in oil production. The deadline comes

OPEC+ agreed on Sunday to slightly increase oil production in December and to suspend increases in the first quarter of next year. At the same time, the group is modifying its plans to regain market share due to growing concerns about excess supply, Reuters reported.

On Sunday, the eight OPEC+ members attending the group's monthly meeting – Saudi Arabia, Russia, the United Arab Emirates, Iraq, Kuwait, Oman, Kazakhstan and Algeria – agreed to increase production targets for December by 137,000. barrels per day, which is the same as planned for October and November.

“After December, due to seasonality, eight countries have also decided to suspend production increases in January, February and March 2026,” the group said in a statement.

OPEC+ raised production targets by about 2.9 million barrels per day – or about 2.7%. global supply – since April, but has slowed down since October due to forecasts of impending oversupply.

As Reuters writes, new Western sanctions against Russia, an OPEC+ member, increase the challenges in this strategy, as Moscow may have difficulty further increasing production after the US and Great Britain imposed new measures on major producers Rosneft and Lukoil.

“OPEC+ is winking – but it's a calculated grunt,” said Jorge Leon of Rystad.

“Sanctions imposed on Russian producers have introduced a new level of uncertainty to supply forecasts, and the group knows that overproduction now may backfire later,” he added.

Leon said that by abstaining, OPEC+ is protecting prices, showing unity and buying time to see how the sanctions will affect Russian barrels.

Giovanni Staunovo of UBS told Reuters that oil prices were unlikely to change significantly after the opening of trading on Monday as a modest increase in production was widely expected in December.

OPEC+ had been reducing production for several years until April, and in March the cuts peaked at a total of 5.85 million barrels per day.

The reductions consisted of three components: voluntary cuts of 2.2 million barrels per day, reductions of 1.65 million barrels per day by eight members, and a further reduction of 2 million barrels per day by the group as a whole.

The group is withdrawing voluntary cuts, and the last element of cuts for the entire group is expected to apply until the end of 2026.

The eight OPEC+ member states will meet again on November 30, the same day as the full OPEC+ meeting. (PAP Business)

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