05/11/2024 by Mark
The OPEC+ group of oil-producing countries could further delay a planned production increase, according to sources cited by Reuters.
The organisation had planned to allow some participating countries to increase their production of crude oil by a total of 180,000 barrels per day (bpd), but this was delayed to December due to a fall in oil prices.
Reuters now reports that three sources have told it that this may be delayed again by at least a month. One source said to Reuters:
“The December hike could be postponed as the market is not healthy enough.”
While the group has made substantial cuts, not all operators are bound by them. For example, ExxonMobil, the maker of the Mobil DTE hydraulic oil, has increased its production in Guyana and the United States. Combined with concerns about uncertain demand, this has meant oil prices have stayed relatively low.
The OPEC+ group has made two layers of production cuts. The first 3.66 million bpd of cuts will remain in place until the end of next year.
A further 2.2 million bpd in cuts were made by eight OPEC+ countries, however, and it is these that the group would like to gradually unwind. Oil prices traded slightly higher on the news of a possible delay to the production hike but remained well below the level that countries like Saudi Arabia would like to see.
The next full meeting of OPEC+ ministers will be held on December 1, during which they will decide on policy development.
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