Today’s meeting of the OPEC+ alliance takes place against a complex background, in which there is, among other things, a possible increase in supply from Iran’s return to the markets.
The Organization of the Petroleum Exporting Countries (OPEC+) and its allies, including Russia, are likely to keep production quotas unchanged today, six sources told Reuters. Some sources, however, did not rule out a small production cut of 100,000 barrels per day to bolster prices that had fallen on fears of a global economic slowdown.
Today’s meeting of the OPEC+ alliance is taking place against a complex background, in which there is, among other things, a possible increase in supply from Iran’s return to the markets, if Tehran can revive the nuclear deal it made in 2015.
Russia, meanwhile, has said it will stop giving oil to countries that support the imposition of a ceiling on supply prices over its war in Ukraine.
At the same time, it has further reduced natural gas flows to Europe, which will likely lead to larger increases in its prices.
The price of Brent fell to around $95 a barrel from $120 in June on fears of an economic slowdown and recession in the West.
Iran is expected to increase global crude supply by 1 million barrels per day, or 1% of global demand, if sanctions are eased, although the prospect of a nuclear deal looked less clear on Friday.
In August, OPEC’s biggest producer, Saudi Arabia, signaled possible output cuts to counter what it sees as excessive price cuts.
Data from the physical market, however, shows that supply remains tight and many OPEC countries are producing below targets, while new Western sanctions threaten Russian exports.
RES-EMP
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